Oil chief fights to save tax breaks

Calls for tax incentives for fossil fuel companies to be abolished are ‘misguided’ according to a senior figure in the industry.

In a letter to the Financial Times, Malcolm Webb, chief executive of Oil and Gas UK said that portraying the industry as being subsidised by taxpayers because of capital allowances is wrong. He argued instead that oil and gas companies are the highest taxed in the country, with profits taxed at between 50% and 75% compared to 28% for other industries.

Webb also argued that tax incentives needed to be retained in order to maximise UK oil and gas production and stop the country’s reliance on imports increasing. The drive towards renewable fuels will not be able to offset a significant loss of UK oil, he said.

‘A worsening of terms on which the UK’s oil and gas producers operate, such as the dismantling of capital allowances on investment, will only drive away investors and ensure an early and enduring crisis in our energy supply.’