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Shell paid no tax in 2021, and received £100m from the public purse

ENERGY giant Shell paid no British tax on its profits from exploiting North Sea oil and gas last year but received £100 million out of the pockets of struggling taxpayers.

The company’s report also showed that it paid £17 billion in tax in other jurisdictions, including Norway, Qatar and the United States, according to Labour Party analysis published yesterday.

Labour also found that both Shell and its rival BP received government handouts for oil and gas production to the tune of £700m since 2016.

The analysis of the company accounts revealed that the goverment give BP and Shell more money in tax breaks that any other country where the firms have dealings.

Shadow climate change minister Kerry McCarthy said: “Since 2016, oil and gas giants have been paid huge amounts from the public purse under the uniquely generous tax regime the Tories have created for them. 

“Even now, when oil and gas profits are soaring to record levels and people are struggling to pay their energy bills, the Tories have given them yet another tax break. It is time that they pay their fair share.”

Campaigning organisation the National Pensioners’ Convention condemned the tax breaks for energy giants making “such obscene profits.”

General secretary Jan Shortt said: “It is disgusting that big companies can rake in billions during an unprecedented cost-of-living crisis while millions, including our oldest and most vulnerable, suffer as they struggle to even afford the most basic essentials.”

Chancellor Nadhim Zahawi “must do more to rein in the energy companies’ outrageous profits and help those facing a grim winter ahead,” she said.

Ms Shortt warned that financial disaster is looming for older people.

“We’ve heard of many people so desperate that they are using equity release on their homes just to pay their bills,” she said. “It’s a crazy situation and not at all necessary.”

Shell said that “changes to the North Sea fiscal regime is not an outcome we would like to see.”

Responding to the Morning Star, the company said: “We understand the worry for millions of people about how high energy costs are challenging their household budgets and the need for support to help make ends meet and we will work with the government on potential solutions.”

“We have a responsibility to safely and efficiently decommission legacy assets, which requires significant expenditure. Under the tax framework, companies holding a licence in the UK and decommissioning an asset can claim a tax deduction in their corporation tax return equal to the amount spent on decommissioning those assets.

“The North Sea is the cornerstone of the UK oil and gas industry and a major contributor to the public purse. Since 2002, Shell alone has paid over £7 billion in tax to the UK exchequer from our UK oil and gas business and we expect to contribute hundreds of millions of pounds in tax in the UK in 2022.“

The company also claimed that it planned to invest £20-£25bn in British energy in the next decade.

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