The UK government proposes to ease taxation of the oil and gas industry in its 2016 budget disclosed on Mar. 16.
“Today’s announcement does indeed mark further progress in modernizing the tax regime for an increasingly mature basin,” said Deirdre Michie, Oil & Gas UK chief executive.
The budget abolishes the 35% petroleum revenue tax and reduces the supplementary charge on producers to 10% from 20%.
Among other provisions, it provides an additional £20 million of funding for a second round of seismic surveys in 2016-17.
The budget also provides assurance of the availability of decommissioning tax relief when offshore equipment is sold.