Scrapping windfall tax on oil and gas is ‘utterly essential’, Swinney insists

John Swinney has again insisted it is “utterly essential” that the UK Government scraps the windfall tax on North Sea oil and gas.

The Scottish First Minister, speaking ahead of a meeting between Chancellor Rachel Reeves and energy bosses, said the current “uncertainty over energy supplies” as as result of the conflict in the Middle East was now a “material consideration” for the scrapping of the charge – which is officially known as the energy profits levy.

Introduced by the Tory government in the wake of the war in Ukraine – which sparked a sharp rise in energy prices – the charge was brought in to claw back some of these unexpected profits for the Treasury.

But the Scottish First Minister said it is impacting investment in the North Sea and costing jobs.

Speaking during a visit to Inverness, Mr Swinney said he had hoped the Chancellor would use Tuesday’s spring statement to axe it.

When that did not happen Holyrood’s Finance Secretary, Shona Robison, said Ms Reeves must use Wednesday’s meeting with North Sea industry leaders to “announce an end to this tax on Scotland’s energy”.

Mr Swinney meanwhile insisted: “Now that we have the conflict in the Middle East I think it is utterly essential that the energy profits levy is removed.

“I had hoped it would be removed yesterday in the spring statement. It hasn’t been but the Chancellor is meeting the industry today.

“And I hope that results in the removal of the energy profits levy.”

Mr Swinney, speaking to the Press Association, added: “I’ve been saying to the UK Government for some time that the energy profits levy should be removed because it is hampering investment in the North Sea oil and gas sector, which is resulting in a loss of employment at a much faster rate than we anticipated.”

With the conflict in the Middle East leading to “uncertainty over energy supplies in the period to come” the First Minister said that was now a “material consideration in whether the energy profits levy should be maintained”.

He insisted however: “I don’t think there is a case for it and it should be removed.”

The UK Government has been contacted for comment.