(Bloomberg) — BP Plc said it will look again at its investment plans in the UK after the government announced a £5 billion windfall tax on oil and gas profits.
The statement raises the possibility of reversal from the London-based company, which previously said its plan to invest £18 billion in the country wasn’t contingent on whether or not the government raised taxes. Offshore Energies UK, a lobby group, said the new levy would damage the oil and gas industry.
The UK government announced on Thursday that it will impose a 25% windfall tax on oil and gas companies, bowing to mounting pressure to support Britons facing a record squeeze on living standards. Chancellor of the Exchequer Rishi Sunak appeared to try to head off criticism that the measure was anti-business, including an 80% new-investment allowance that allows energy companies to reduce the amount they pay if they commit to capital expenditure.
“We know just how difficult things are for people across the UK right now and recognize the government’s need to take action,” BP said in an emailed statement. The tax changes will have a multiyear effect and “we will now need to look at the impact of both the new levy and the tax relief on our North Sea investment plans.”
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