Labour calls for energy firms to pay more tax on £60m-a-day profits
Energy companies are making £60m in profits a day from operations in the North Sea and should be paying more in tax to fund a freeze on council tax for cash-strapped households, according to Labour.
Labour’s call comes before the latest financial updates from Shell and BP this week. The energy companies are expected to report more bumper profits to the London market due to the spike in prices caused by Russia’s invasion of Ukraine.
UK-headquartered Shell made $40bn (£32bn) in profits last year, one of the largest in British corporate history and the best performance in its 115-year history, while BP more than doubled annual profits to $28bn.
Other energy companies including Centrica, the owner of British Gas, also posted record profits last year.
Labour estimates that the largest energy companies have already booked £7bn in profits so far this year – the equivalent of about £60m a day – from North Sea operations.
Ed Miliband, the shadow climate change and net zero secretary, said: “While families face the crunch from soaring bills, these new figures confirm yet again that the Conservatives are refusing to do the fair and right thing and bring in a proper windfall tax on oil and gas giants to help freeze council tax this year.
“That’s the choice Labour would make ahead of these local elections, because we are on the side of working people.”
Prime minister Rishi Sunak originally introduced a 25% energy profits levy, more commonly known as a “windfall tax”, which was meant to run until the end of 2025 when he was chancellor. In January, the windfall tax was increased to 35% and will run until March 2028.
Harbour Energy, the North Sea’s biggest producer, has claimed that the tax “all but wiped out” its profits last year. Oil and gas
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