UK Finance Minister Sunak: Will introduce a temporary levy on energy profits

In an announcement relating to the UK's worst cost-of-living crisis in multiple decades on Thursday, UK Chancellor of the Exchequer (the UK's Finance Minister) said that the government will be introducing a temporary levy on energy profits, reported Reuters. The oil and gas sector is making extraordinary profits, Sunak noted, saying that he is sympathetic to taxing those profits. 

It is possible to tax extraordinary profits and encourage investment, Sunak said, before announcing that the government would also be introducing a new investment tax incentive. The new profit levy will be charged at a rate of 25%, while the new investment allowance will double relief for energy and gas companies, meaning that the more a company invests, the less taxes they will pay.