NORTH SEA FISCAL REGIME

Early day motion 869, tabled 2 March 1998 by Norman Godman (Labour). Signed by 36 members.

That this House recognises that the prevailing North Sea fiscal regime is exceptionally weak by both historical and international standards, that while United Kingdom production of hydrocarbons has reached a record level, the Governemnt's share of the gross trading profits of oil and gas companies was only 25 per cent. in 1996 compared with 48.6 per cent. in 1987, that in 1996 North Sea tax revenues were still ú1 billion less than in 1987 despite the fact that gross trading profits were ú4.8 billion greater, that the rate of return for oil and gas companies was 12.5 percentage points greater than the average for other United Kingdom industrial and commercial companies, that a majority of North Sea assets are controlled by foreign companies, that the United Kingdom is unique in being the only country in the world which does not charge any special petroleum tax or royalty for the exploitation of fields developed since 1993 and that the recent reduction in corporation tax to 31 per cent. will further reduce the tax-take from the North Sea; and this House therefore urges the Treasury team to take all these factors into full account before they finalise their current review of the North Sea fiscal regime.

Signatures by party: Labour 32, Labour/Co-operative 3, Liberal Democrat 1.