UK’s Oil & Gas Authority has greeted the 2016 Budget , announced on Wednesday by the Chancellor of the Exchequer, George Osborne, by saying the measures announced represent a timely support for the sector.
The 2016 Budget, which revealed that the oil and gas industry will be aided by tax cuts worth £1 billion, was also welcomed by the body representing the oil and gas players in the UK, Oil & Gas UK .
Oil and Gas Authority chief executive, Andy Samuel , said: “The Oil and Gas Authority very much welcomes the measures announced as part of the Chancellor’s Budget announcements which provide timely support to investment in the UK oil and gas industry.
“The permanent reduction in Petroleum Revenue Tax from 35% to 0% will help to create a level playing field between old and new fields, recognising the maturity of the basin. This, in addition to the reduction in the Supplementary Charge from 20% to 10% sends a clear message that the Government is continuing to strongly support the industry by providing a truly competitive fiscal regime.
“We are also very pleased to see plans to extend the Investment Allowance to allow tariff income on third party access to be included, as well as greater certainty on decommissioning tax relief; which overcomes what has been a stumbling block to asset transfers. ”
Boost to the sector
Samuel also said: “These measures, in addition to the further £20 million exploration package announced by the Prime Minister in January and the creation of the Oil and Gas Technology Centre as part of the City Region Deal are a welcome boost to the sector.
“We are pleased to have helped progress key pieces of work alongside HMT and industry via the three collaborative workstreams focusing on exploration, infrastructure and late life. OGA will continue to work closely with industry and Government to maximise economic recovery from the basin.”