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Tax Take From North Sea Oil To Dry Up After Global Price Slump

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The Treasury’s official forecaster expects the Treasury to receive just £2bn in tax revenues from the North Sea oil industry over the 20 years after 2020 due to the collapse in the global oil price.

The independent Office for Budget Responsibility (OBR) made the shock prediction in its latest fiscal sustainability report. This time last year, before the near halving of the price of a barrel of Brent crude, the OBR was expecting the industry to generate around £37bn in tax revenues between 2020 and 2040.

The change underlines how the seismic shift in the global energy markets will affect the UK’s public finances and pose a serious challenge to the Scottish National Party, much of whose case for an economically flourishing independent Scotland rests on the premise of abundant revenues from the North Sea.

At the time of the March Budget, the OBR lowered its forecast for oil revenues over the five years to 2020 from an average of £2.6bn a year to £700m.

Its latest forecasts actually suggest that the contribution to the Treasury from the North Sea will turn negative in the 2020s as companies offset trading losses and rig decommissioning costs against tax.

O dear looks like George might have a bit of a problem.

Rapidly increasing debt servicing costs and the golden goose of North Sea oil contracting. Still I'm sure cutting benefits to poor people will help fix all these problems.

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If they've assumed the March price likely idiotic. Looking to double from then snd probably settle for 150-175% of low

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