Chancellor of the Exchequer, Rishi Sunak has announced plans to help alleviate soaring energy prices and combat the cost-of-living crisis with a £15 billion support package.
Sunak has announced a ‘temporary targeted Energy Profits Levy’ of 25% on the profits of oil and gas companies. He continued that these ‘extraordinary profits’ must be taxed fairly and in a manner that will incentivize future investment. He also emphasised that these levies will be temporary and will be phased out once oil and gas prices return to ‘historically more normal levels.’
As a result of this Levy:
- Each household in the UK will receive a £400 energy bill grant
- Around 8 million of the lowest income households will receive a one-off cost of living payment of £650
- Around 8 million pensioner households who receive the Winter Fuel Payment will receive an extra £300
- Around 6 million disabled people will receive £150
Sunak emphasised that the Government’s response to the current economic situation needed to be ‘timely, temporary and targeted’ in order to ease the burden on the population and to avoid greater risks to the economy in the long run.