Sunday 15 May 2022

Why No Windfall Tax?

During a bleak time when fuel bills have more than doubled and the choice between heating or eating is a real life choice for many people, this isn't the best time for the energy companies to announce their massive profits but announce they did and it is nice to know that someone isn't tossing up between turning up the radiator or microwaving the kid's Tesco Value range Lasange.
Shell reported this week that its profits in the first three months of the year hit a record breaking £7.3bn in the first three months of this year while BP flourished a profit sheet with more than £5bn on the bottom line, more than double last years profit.
BP’s chief executive, Bernard Looney, let slip last November, when Brent crude hit $85 a barrel, that the business was 'a cash machine at these types of prices' and as it sits today at $111 a barrel, that sound you can hear is the cash machine overheating.
Strangely, the UK Government have been against a windfall tax on these huge profits to help the struggling population and originally collected around the 'more profits mean more investment projects' excuse although they went silent on that after a journalist asked the BP Chief what projects would he would cancel if a windfall tax was imposed on the firm’s profits. None, he replied.
'Ah yes' they said, 'but a tax on BP and Shell would hit pensions' which again came up short when the pension people said actually, UK pension funds own less than 0.2% of Shell and BP shares so a windfall tax would have a negligible effect.  
The idea, which would raise £2bn for the Government's rapidly emptying coffers, has now been kicked into the long grass with a grudging 'we'll give it some thought' comment from the Government but why are they so reticent to tax the fuel sector which is raking in obscene profits while the rest of us are starving, freezing or possibly both?
OpenDemocracy have looked at the list of Tory donors and noted that the Conservative Party has accepted more than a million pounds in donations from the energy sector since the last election, including £25,000 from oil firm's EnQuest, £180,000 from Abbot Group, £200,000 from Balmoral Group Holdings, Aquind has handed over £112,000, Tratos have given £56,000, Scottish Power has given £8,400, £58,000 from Bayford and Co, Motor Fuel Group has given £30,000, while Murex Energy has coughed up £25,000.
£50,000 was donated by Access Industries owned by Russian oil tycoon Len Blavatnik and suddenly it becomes a little clearer why the Conservatives are reluctant to hit the profits of the very people who donate so much to them, therby possibly hitting their generous donations.
Makes sense now why they would rather sack 91,000 Civil Servants instead.

No comments: