UK ‘urgently considering’ to extend windfall tax to electricity generators

Rishi Sunak has said there are “extraordinary profits” made in the electricity generation sector

Big Zero Report 2022

The government has confirmed it is ‘urgently considering’ the extension of the windfall tax to electricity generators.

Two weeks ago, ELN reported that operators of wind farms could soon have to pay a windfall tax as the cost of living crisis bites.

The government’s cost of living package includes a temporary windfall tax of 25% on the excess profits of oil and gas firms.

Speaking during a Treasury Committee’s session on the recently announced cost of living support package, Rishi Sunak said: “We announced an Energy Profits Levy which will raise around £5 billion over the next 12 months.

“And alongside that, we are urgently considering the case to extend that levy to the electricity generation sector where we do believe there are extraordinary profits also being made.

“Many other countries in Europe have taken steps to address that and we have a longer term plan to reform the market but we need to make sure that actually in the shorter term we have got the right policy in place, but we are urgently undertaking that work.”

The Chancellor was asked whether there would be more measures in autumn to protect households as analysts predicted the price cap could spike to more than £2,900 for the first time.

Mr Sunak said: “What we have put in place is significant and extends all the way through to the end of the financial year.

“The best way over time to help people is to make sure we have a growing economy with people in work with their wages going up and all the plans that we’ve got in place will make progress on that goal.”

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