Osborne Proposes Tax Allowance for Generating Investments in North Sea

Osborne Proposes Tax Allowance for Generating Investments in North Sea

Chancellor George Osborne yesterday declared a few measures, which are being believed to help generate the investment required for the North Sea. Mr. Osborne suggested tax measures which would help fetch an extra £2 billion.

Previous year, UK government flagged off concerns over sharp increase in the taxes paid by oil firms to exploit oil fields. Following which, it has been unveiled that these oil companies will no longer have to pay taxes for taking oil and gas from older fields.

As per the recent measures, oil companies will not be paying full duty for exploiting older fields. Mr. Osbourne said, "The new Brown Field Allowance will shield up to £500 million of income from the charge when firms are boosting production from established fields, potentially cutting their tax bill by £160m".

However, the step will definitely affect the Exchequer, costing it around £100m per year initially. However, the officials are sure that after some time, the tax revenues collected will help balance the situation.

On the other hand, Mr. Osborne asserted that the move will turn out to be beneficial not only for the North Sea, but will also be a major step forward towards a better economy and also provide people with job opportunities.

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