WINDFALL TAX U-TURN WILL SEE EVERY HOUSEHOLD GIVEN £400 WITH MORE FOR THE MOST VULNERABLE ON LOW INCOMES

Chancellor Rishi Sunak has told parliament that a temporary 25% windfall tax upon the profits of oil and gas companies will help towards giving UK households and vulnerable people more support with the rising cost of living, as he sets out what he said was a £15 billion support package.

This is a U-Turn by the Government which voted against a windfall tax on energy companies just last week.

Mr Sunak said that the Government can not solve every problem but need to ensure those struggling the hardest receive support.

So far the chancellor has disclosed that:

Every household in the UK is to get an energy bill discount of £400 which will not have to be paid back.

Those on the lowest incomes - around eight million people supported through welfare system - will receive one-off cost of living payment of £650 which will be paid in two lump sums.

Pensioners who receive the winter fuel payment will receive a one-off payment of £300

Six million people who receive disability living allowance will get a payment of £150

The planned energy bill loan has also been scrapped.

Mr Sunak said:

Quote

 

"The oil and gas sector is making extraordinary profits not as the result of recent changes to risk taking or innovation or or efficiency as the result of surging global commodity prices driven in part by Russia's war.

"For that reason I am sympathetic to the argument to tax those profits fairly.

"It is possible to both tax extraordinary profits fairly and incentivise investment."

 

This latest move should see the most vulnerable households in the UK approximately £1,200 better off this year, although people are still facing the prospects of rising costs for food in supermarkets as well as increasing petrol prices as a result of the war in Ukraine.