Wolverhampton MP calls for windfall tax on the 'massive profits' by oil and gas companies amid cost-of-living crisis
Chancellor Rishi Sunak should impose a windfall tax on the "enormous profits" oil and gas companies are making to help hard-pressed households, an MP has said.
Pat McFadden, who represents Wolverhampton South East, said estimates could see the average annual household energy bill rise to £3,000 or more from October.
The Labour front-bencher said a package of support drawn up by Mr Sunak, in which households could receive up £350 of support, was now rendered "obsolete".
And the Chancellor of the Exchequer should reconsider his refusal to impose a windfall tax – a one-off tax imposed by the Government – to help those in need.
But Mr Sunak has said the tax would put off further investment into the UK as he blamed decisions by the previous Labour Government for the current situation.
Mr McFadden, Shadow Chief Secretary to the Treasury, said: "The package on energy announced by the Chancellor last month has already been rendered obsolete by Russia’s invasion of Ukraine.
"Some estimates of average annual household energy bills suggest that there will be rises to £3,000 or even more from October. That is a ruinous figure for many of our constituents.
"Will the Chancellor revisit this support package in next week’s spring statement, and will he reconsider his refusal to fund help for hard-pressed households through a windfall tax on the enormous profits that oil and gas companies are making?"
The Wolverhampton MP said global factors are driving up energy prices and inflation in many countries, but what "singles out" the Government is a move to impose tax increases during the crisis.
He added: "Of course, there are global factors driving up energy prices and inflation in many countries, but what singles out the UK is this Government’s decision to impose a tax rise on working people right when the impact of rising energy bills is hitting people the hardest.
"Why are the Government so determined to make the cost of living crisis worse now with these tax rises, particularly when the Treasury is briefing anyone – including the Government’s own back-benchers – who will listen that the Tory party is planning pre-election tax cuts?"
Mr Sunak said part of the reason the country was in the situation with energy prices is because of the decisions made by the previous Labour Government, in particular nuclear energy, which they were "rapidly having to make up for".
He said: "It is worth bearing it in mind that, because of the price cap, households will be protected all the way through the autumn. We do not know what the price cap will be at that point. If the (MP) knows, he is probably in the wrong line of business, and it would be good if he could tell the rest of us.
"Regarding a windfall tax, Conservative members believe in getting more investment into the North Sea and exploiting our domestic resources. The round-table that the Chief Secretary to the Treasury, the Prime Minister and the Business Secretary hosted showed that there is enormous appetite to invest more in the UK. A windfall tax would put off that investment."
