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Windfall tax 'could slash fuel prices'

23rd November 2000, Page 12
23rd November 2000
Page 12
Page 12, 23rd November 2000 — Windfall tax 'could slash fuel prices'
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Which of the following most accurately describes the problem?

• The government could cut fuel prices dramatically by taxing the North Sea oil companies' huge windfall profits, MPs have been told.

At the moment the Treasury collects 11 times as much from taxing drivers at the pumps as it does from the oil companies, according to Dr Philip Wright, a reader in economics at the University of Sheffield, who gave evidence to the Commons Treasury Select Committee.

Wright called for a shake-up in the way that oil companies are taxed—a move that could boost the government's coffers and help reduce fuel tax.

He believes that the oil giants are set to reap windfall profits of about 17bn this year because of the sharp rise in world oil prices.