By Paul Homewood
We’ve had some discussion about fossil fuel subsidies, so I though it worth just summarising the position with regards to North Sea oil.
Producers of North Sea oil are taxed in three ways:-
1) Petroleum Revenue Tax (PRT) – this only applies to fields operating, or with consent, prior to 1993.
PRT is charged at 50% of profits, specifically for that field. In other words, losses from one field cannot be offset against the profits from another.
2) Corporation Tax – this is normally at 30% of profits (after PRT has been accounted for). Note that this is higher than normal corporation tax, which is now 20%.
3) Supplementary Charge – this is an addition to Corporation Tax, and is set at 20%, calculated against the profit before Corporation Tax.
So we can summarise:
|Pre 1993||Post 1993|
|Profit after PRT|
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