The UK Treasury Department said in a statement that the UK will impose a 25% levy on windfall profits from oil and gas companies as part of measures to tackle the cost of living crisis.
The new 25 percent levy will be levied on excess profits generated by oil and gas companies to help families with the cost of living.
Inflation in the UK has been breaking records in recent months. In early May, the Bank of England raised its inflation forecast for 2022 and expects it to accelerate to 10.25% in the fourth quarter, which could be a historical record. The regulator noted that since the last publication of the report in February, inflationary pressure has sharply increased due to the aggravation of the situation between Russia and Ukraine. This, according to the Bank, led to a “significant deterioration in growth prospects in the world and the UK.”
Millions of households in the UK are facing an unprecedented increase in electricity and gas prices of £700 a year following a 54% increase in the energy price cap in early April.