Related: Chancellor increases energy windfall tax to raise extra £14bn
Rishi Sunak is likely to face his first defeat in the House of Commons as prime minister, after several Conservative MPs signed Labour’s amendment to a bill demanding chancellor Jeremy Hunt spell out the full cost of windfall tax allowances for fossil fuel firms.
This comes as Labour accused the government of “botching” its windfall tax on North Sea oil and gas companies by leaving holes that, according to party estimates, are likely to cost £17bn to the exchequer.
Chancellor Jeremy Hunt had announced the windfall tax on oil and gas giants will increase from 25 per cent to 35 per cent and extend the tax to 2028, having faced pressure to increase the Energy Profits Levy, as it is known.
Shadow chancellor Rachel Reeves said that the sums which could be raised by ditching the allowance – as well as backdating the windfall tax to the start of 2022 and matching Norway’s 78 per cent levy on its North Sea firms – was the equivalent of three years’ turnover for the UK wind power industry and could pay for the insulation of 6 million homes.
