Oral Answers to Questions Debate

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Department: HM Treasury

Oral Answers to Questions

Caroline Lucas Excerpts
Tuesday 1st February 2022

(2 years, 9 months ago)

Commons Chamber
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Lucy Frazer Portrait Lucy Frazer
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If the hon. Member wants to give me the details of her constituent’s case, I would be very happy to look into it.

Caroline Lucas Portrait Caroline Lucas (Brighton, Pavilion) (Green)
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4. What assessment he has made of the compatibility of his policies on the taxation of fossil fuels with the Glasgow climate pact.

Lucy Frazer Portrait The Financial Secretary to the Treasury (Lucy Frazer)
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I am pleased to have an opportunity to underline the Government’s commitment to reducing carbon emissions through taxation and the UK’s success in limiting global emissions at COP26. The Government have reduced carbon emissions through their carbon pricing policies, including through the UK emissions trading scheme. We are committed to delivering on our carbon targets, and our net zero strategy sets out a roadmap for reaching net zero by 2050.

Caroline Lucas Portrait Caroline Lucas
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I thank the Minister for her answer, but she will know that the UK has one of the most lax tax regimes in the world for the oil and gas sector. In 2019, companies got away with paying 12.5 times less tax for a barrel of oil produced here compared with in Norway, for example. In 2020, Shell paid absolutely no tax in the UK, the only country in the world where it operates where that was the case. For 2021, HMRC expects that the industry will pocket £910 million-worth of tax reliefs for decommissioning. Given our commitments under the Glasgow climate pact, and given the fact that the oil and gas industry is currently making near-record profits while UK households are struggling with a real cost of living crisis, will the Minister address the imbalance and commit to a review of the tax regime?

Lucy Frazer Portrait Lucy Frazer
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The hon. Member will know that the oil and gas sector does pay significant taxes. Indeed, it pays additional taxes, and to date it has paid more than £375 billion in production taxes.