Oil and gas companies received 4.75 billion pounds ($6.2 billion) in U.K. tax breaks over the past six years for decommissioning oil operations, primarily in the North Sea.
The U.K. tax authority published the figure Jan. 31 after the Committee of Public Accounts, which monitors government spending and tax policy, found that “because of gaps in its understanding of the costs, the government does not know whether a large number of tax incentives provide value for money.”
- Tax breaks used to offset against corporation tax and petroleum revenue tax
- Last week the country’s National Audit Office (NAO) said the government has set aside a further 24 billion pounds’ worth of tax breaks for companies in coming years
- The oil and gas sector has paid 334 billion pounds in tax since 1970-71, the NAO reported
- In 2016-17, for the first time, the government paid out more to oil and gas operators in tax relief than it received from them in revenue, because of lower production, lower oil prices, and high deductible expenses