26th May 2022
Following confirmation of the additional energy producers’ profits levy on companies by the UK Government, Dr Liz Cameron CBE, Chief Executive of the Scottish Chambers of Commerce, said:
“Scotland’s businesses warned about the damaging impact that any sort of additional windfall tax on energy companies would have on the economy and our ability to secure a successful energy transition that protects jobs and communities.
“It is extremely disheartening that the UK Government have chosen to introduce this additional levy which will inevitably deter investment and make Scotland and the UK a less attractive market internationally, adding to the pressures facing the business community.
“Whilst it’s right that the Government take steps to ease the cost of living crisis this levy is a short term solution to the long-term energy challenges businesses and consumers continue to face.
“Rather than supporting investment in decarbonisation and energy security, this levy will only serve as a sticking plaster for rapidly rising bills, does little to support businesses and is ultimately a short sighted and opportunistic policy from the Treasury.
“With yet again no additional financial support announced for SMEs, this was another missed opportunity by the Chancellor to introduce a SME energy price cap or address the rising costs of doing business that is now dragging on economic growth.”
Commenting, Ryan Crighton, Policy Director at Aberdeen & Grampian Chamber of Commerce, said:
“Where the industry, the Chancellor and Prime Minister agree is that a windfall tax will deter investment in both the North Sea and our energy transition. All three have been repeating that mantra for months now.
“In the short-term, taking an additional £5billion from a sector already taxed at 40% will achieve very little apart from making the North Sea – already one of the world’s most mature basins – less attractive to investors. Tax and fiscal stability, above all else, are what really matter in a globally competitive investment market, and today we’ve shot ourselves in the foot.
“It is clear that the Treasury has benefited enormously already from higher energy prices, to the tune of £19million per day so far this year, and therefore offering targeted support to consumers and businesses was already within its gift, without this damaging additional tax raid, which needlessly puts obstacles in our path to net zero and will increase our reliance on imported energy at a greater environmental and financial cost.”