UK's Johnson refuses to rule out windfall tax, but says 'I don't like them'
By Frank Prenesti
Date: Thursday 12 May 2022
(Sharecast News) - UK Prime Minister Boris Johnson insisted on Thursday that he was still opposed to a windfall tax on energy companies, but refused to rule the possibility of introducing a one-off levy.
Maintaining his claim that a levy would deter investment, despite BP chief executive Bernard Looney saying otherwise, Johnson said he did not believe they were "the right way forward".
Britons are being squeezed by the cost-of-living crisis as a combination of factors hit household budgets.
The Ukraine war has driven up oil and gas prices, while UK consumers were also hammered by a massive 54% rise in gas and electricity prices on top of a promise-breaking income tax rise and rampant inflation.
"The disadvantage with those sorts of taxes is that they deter investment in the very things that they need to be investing in - new technology, in new energy supply," he told LBC radio.
Pressed on whether he would completely rule out a windfall tax, Johnson deflected, saying that he did not "like them".
"I didn't think they're the right thing. I don't think they're the right way forward. I want those companies to make big, big investments."
Looney on Thursday repeated his assertion that BP's investment plan would not be affected by a one-off tax.
"Our £18bn plans are not somehow contingent on whether or not there is a windfall tax," Looney said at an annual shareholder meeting.
UK media reported that the Treasury was also considering introducing a windfall tax with Finance Minister Rishi Sunak reportedly asking officials to look into plans for a levy.
Momentum is also growing in the private sector for an assistance package to help people cope with the crisis.
On Tuesday, Tesco chairman John Allan on Tuesday said there was an "overwhelming case" for a windfall tax on energy companies to help ease the cost-of-living crisis for most Britons.
Speaking on the day the UK government unveiled a legislative programme that contained no measures to address soaring inflation and prices, Allan also revealed some Tesco customers were rationing their supermarket grocery shop.
Allan also said he did not believe the government's position, adding that energy companies were "expecting it ...and they wouldn't be much fazed by it. It should be short-term only".
He said Britain faced "real food poverty for the first time in a generation," and that people were finding it even harder to mitigate soaring energy costs.
Reporting by Frank Prenesti
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