Chancellor announces tax incentives for North Sea oil and gas in 2017 Budget – ODI statement

22 November 2017

In today’s budget, Chancellor Philip Hammond announced further tax incentives to encourage investments in North Sea oil and gas.

Shelagh Whitley, Head of the Climate and Energy Programme at ODI, said: 'The Chancellor has today spoken about the need to build an economy fit for the future, yet at the same time announced further tax incentives and extra financial support for the increasingly expensive and out-dated oil and gas sector.

'ODI research shows the government is already handing out £665 million per year to support North Sea oil and gas production. These additional tax incentives are not just bad for the environment, they are also bad economics.'

The Chancellor today also announced higher taxes for diesel car owners and an extra £540 million to be spent on infrastructure to support electric vehicles.

Shelagh Whitley said: 'While we welcome the additional support to electric vehicles and the incentive to move away from diesel, the government is continuing to subsidise the use of fossil fuels throughout the transport sector.

'Our research published this year shows that subsidies to the transport sector, including tax breaks for diesel, amounted to £7.4 billion per year on average between 2014 and 2016, fuelling dangerous climate change and an air pollution crisis in the UK’s cities.

'Eliminating all UK government support to fossil fuels would help position the UK as a global leader on climate change and assist the shift towards a low-carbon future.'

ENDS

Notes to editors

  • The report ‘Phase-out 2020: Monitoring Europe’s fossil fuel subsidies’, published in September by ODI and Climate Action Network Europe, found that between 2014 and 2016 the UK provided in total an average of £13.3bn ($17bn) a year in national subsidies (direct budgetary support and tax breaks) – most of it directed at the transport sector.

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