Windfall tax raised 25pc less than forecast in December, official data shows

The Government's windfall tax on oil and gas companies raised £600m less than expected amid warnings that the growing tax burden on businesses is hampering investment in

Britain. The cash haul from the Energy Profits Levy (EPL) was 24.5pc less than forecast prepared by the Office for Budget Responsibility (OBR), the Government's fiscal

watchdog, in November. The windfall tax was first introduced in May when Rishi Sunak was chancellor, and was increased in the Autumn Statement after he became Prime

Minister.   North Sea oil and gas profits are being taxed at 75pc until 2028. This is up from the regular rate of 40pc, and is being used to help fund massive government

subsidies for households and businesses by clawing back what companies make from higher wholesale prices. The Treasury expects to raise £7bn from the levy this financial

year and £10bn next year. The Government has raised £3.7bn in extra revenues so far this financial year, according to the Office for National Statistics (ONS). However, gas

prices have fallen dramatically since last summer. Energy giants including Shell and Total have also warned that the levy risks harming investment. Revenue from the EPL in

December represents the first payment on 2022 profits, with the second and final instalment due in January. The OBR said the shortfall “could therefore be a timing effect

between these two months, or could reflect the volatility in oil and gas prices resulting in lower EPL liabilities than our forecast assumed”.