5 Conclusions
26. The fiscal regime must promote investment and
ensure that financially viable recovery from the UK Continental
Shelf is maximised. But it must also ensure that the UK taxpayer
gets a fair return. Despite the ongoing consultations on the shape
of the fiscal regime, UKOOA remains of the view that the latest
tax increase has damaged the competitive position of the UKCS.[84]
27. It is clear from the evidence before us that
the government and industry share a common goal of maximising
recovery from the UKCS. They differ on whether the recent tax
changes hinder the achievement of this shared objective. If prices
fall it seems clear that there would be a negative impact,[85]
but while prices remain high the true impact of the tax increases
may remain much harder to see.
28. Within the
industry, there is clearly a perception of instability and if
there are to be further changes to the fiscal regime they should
seek to improve stability and predictability, without harming
the UK's already competitive position or depriving the UK Government
of a fair share in the economic rent from the exploitation of
its natural resources. Changes to the fiscal regime should aim
to make the system simpler to administer both for companies and
HM Revenue and Customs.
29. We urge
the Government and the industry to engage constructively in the
current dialogue and to build on that dialogue going forward once
the current consultation comes to an end.
84 Ev 63 Back
85
Q102 Back
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