Shell has reported its second highest quarterly profits on record, with takings between July and September more than doubling. The energy giant said underlying profits reached $9,500,000,000 (£8.2bn) in the third quarter, compared to $4,200,000,000 during the same period last year.
The figures prompted calls for the tax on the profits of energy firms to be raised to help people with bills.
Between April and June, Shell saw record profits of $11,500,000,000, although its profit growth has slowed since then after oil prices fell back from highs of $120 a barrel.
In May when he was chancellor, Rishi Sunak introduced a temporary levy on energy firms’ “extraordinary profits” which he said would raise £5bn .
But on Thursday Ed Miliband, Labour’s shadow climate change secretary said the plans were flawed and “would see billions of pounds of taxpayer money go back into the pockets of oil and gas giants through ludicrous tax breaks”.
A windfall tax is a one-off tax imposed to target firms that are lucky enough to benefit from something they were not responsible for - in other words, a windfall.
However, the government’s tax only applies to profits made in the UK which, for most oil and gas companies, is a small part of their operations.
When it was announced, the Energy Profits Levy was also accompanied by a measure that allows energy companies to apply for tax savings worth 91p of every £1 invested in fossil fuel extraction in the UK.
Oil and gas firms operating in the North Sea are taxed differently to other firms, and their taxes on profits are higher. They pay 30% corporation tax on their profits and a supplementary 10% rate on top of that. Other firms pay corporation tax at 19%, but this is set to rise to 25% in April 2023.
However, oil and gas firms have been able to reduce the amount of tax they pay by factoring in losses or spending on things like decommissioning North Sea oil platforms. It means in recent years, the likes of BP and Shell have paid almost no tax in the UK.
Trompe l’oeil … 
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