The UK tax authority, His Majesty’s Revenue and Customs (HMRC) has opened a consultation on proposals to replace the windfall tax on energy company profits when it expires in 2030.
The government has considered policy options, including international comparators and engaging in discussion with stakeholders. It is now consulting on two models. The first, a revenuebased model (RBM) that would target the excess revenue a company receives for its oil and gas sold above threshold prices. The second, a profit-based model (PBM) that would target a proportion of profits deemed to arise from unusually high prices by reference to ‘average market prices’ and the thresholds.
Energy Secretary Ed Miliband stated, “The North Sea will play a central role in Britain’s energy future. For years, its workers, businesses, and communities have been instrumental in powering both our nation and the world.”
The consultation closes on 28 May 2025.
