Colin Smith, Energy and Infrastructure Tax Partner at PwC UK, said:
“A well-trailed extension of the oil and gas Energy Profits Levy (EPL) to the 31st March 2029 was announced in today’s Spring Budget. This extension, forecast to raise an extra £355m, will disappoint, although perhaps not surprise, the sector.
“From an immediate practical perspective, oil and gas groups that have not yet released their 2023 year end results may have to provide an estimate of the impact of the EPL extension. International financial reporting standards require companies to disclose the deferred tax impact of changes in tax rates or tax laws that are enacted or announced after the reporting period.
“The chancellor confirmed the Energy Security Investment Mechanism (ESIM), which would ‘turn off’ the EPL if prices fall below $71.40 per barrel of oil and £0.54 per therm of gas, will be included in this year’s Finance Bill.”
Spring Budget 2024
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