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London (CNN business) The British government introduces £ 5 billion ($ 6.3 billion) tax on the reducing profit of its oil and gas companies, subject to pressure from activists to collect money to help millions of people who fight with the worst costs. decade.
Minister of Finance Rishi Saunak launched a new 25% tax on the benefits of energy producers such as BP (BP) and Shell (RDSA) on Thursday. Retribution will be removed once the price of oil and gas drops to a more normal level, he said.”The oil and gas sector produces extraordinary benefits, not as a result of recent changes, risk taking or innovation or efficiency, but as a result of the soaring global commodity prices,” Sakah said in a speech to parliament.Taxes will help fund a new benefits package worth around £ 15 billion ($ 19 billion). Sunda said the government would make only direct payments to the millions of the most vulnerable households in the country. About eight million low -income households will receive £ 650 in two installments later this year, while eight million retirees will then receive £ 300.
Companies including BP and Shell made a combined profit of $ 32 billion ago behind the soaring oil and natural gas prices. Russia’s invasion of Ukraine in February pushed further prices because conflict fears would cause lack of energy.
The household has received a big blow. On Tuesday, the Head of the British Energy Regulator said he hoped that the annual bill for millions of households would surge 40% to around £ 2,800 ($ 3,500) from October. It was only six months after the regulator raised the price limit – the maximum supplier was permitted to charge customer fees per unit energy – by 54%, the biggest increase since it began to limit the price of five years ago.
The skyrocketing energy bills have triggered price increases throughout the economy. In April, British consumer price inflation reached 9% – the highest level in 40 years. And because the wage failed to compensate for the increase in food and fuel costs, the standard of living has returned to the lowest level since the 1950s, according to the British office for budget responsibilities.In February, Sadai gave some assistance, offering £ 200 households from their energy bills from October, which will be paid in installments over the next few years. On Thursday, Saunak doubled the discount and said there was nothing to pay back.This support is now clearly a grant,” he said.
The Financial Times reported earlier this week that the government will also target the profits of bumpers from large power plants such as EDF (Ecify) and RWE (RWEOY). But Sung said more time needed for his department to make plans for the electricity sector.Poverty campaigners welcomed Thursday.”The Chancellor has clearly listened to concerns that support for those in fuel poverty must be widespread, but also focuses on the most vulnerable groups,” Simon Francis, coordinator for the final fuel poverty coalition, told CNN Business.Francis added that while the new steps will “take the sting of the tail” the increase in the price of new energy, people in poverty fuel requires more guarantees that support will be available in the medium term
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