Oil - Anything Goes - Other topics not covered elsewhere - Tartan Army Message Board Jump to content

Recommended Posts

Can someone answer a question for me?

How does the value of oil translate into tax revenue?

When there's say, £100 billion of oil, what's the amount of that money which goes into the taxman specifically for the oil?

I'm not interested in Corporation tax and subsidiary taxes at the mo, I know these can massively increase the worth of the industry, I just want to understand how oil extraction relates to oil income for the government.

Link to comment
Share on other sites

Having done a wee bit digging, there's a bit more than that I think.

https://www.gov.uk/government/publications/statistics-of-government-revenues-from-uk-oil-and-gas-production

Petroleum Revenue Tax, Corporation tax which is treated in a very specific way and a supplementary charge which seems to have replace royalties about twenty years ago.

Link to comment
Share on other sites

I think the only money they make is from licences to drill/extract and corporation tax. And that's really it I think. There is nothing else. Vast majority is from corporation tax from what I understood.

Is there not a petroleum revenue tax too per barrel of oil?

The taxes they pay will also have an allowance for spend on rigs/pipes/drilling etc. that reduces the amount of tax per barrel once field comes into production. So probably no two fields pay exactly the same tax rate.....

Link to comment
Share on other sites

It is far, far too complicated for any Scottish person to understand. We are not genetically programmed to understand such things which is why we have leave this sort of stuff to the folk at Westminster.

So, tell us how it works then, I genuinely want to understand this as both sides quote their figures in different units. One side talks about the value of oil left, the other about the value to the exchequer. I'd like to understand how to relate the two.

Because I want to be able to highlight the pish that's coming from Westminster.

Edited by biffer
Link to comment
Share on other sites

So, tell us how it works then, I genuinely want to understand this as both sides quote their figures in different units. One side talks about the value of oil left, the other about the value to the exchequer. I'd like to understand how to relate the two.

Because I want to be able to highlight the pish that's coming from Westminster.

https://www.gov.uk/oil-and-gas-taxation

Link to comment
Share on other sites

A rule of thumb its worth around $10 per barrel to the gov spread across all the fields. The companies buy the original exploration licence for the block in a tender situation initially for $x millions. The corporation tax is paid back in the country where the HQ and many cross charge support like HR / IT /Corporate infrastructure to run divisions at a loss. The actual cost for the North Sea is based on $55 per barrel compared to the middle east which is $5 per barrel. That's why when the barrel drops down to $80 ish the North Sea projects get put on hold.

Link to comment
Share on other sites

It's not just about the tax either

its the infrastructure - part of the $55 per barrel will go to local service companies, who then spend the money locally, where more tax is, and more infastructure drips down to the taxi driver, hairdresser etc etc etc

Aberdeen is now a centre of excellence - so even without Oil in the North Sea there would still be folk in the North East involved in the Oil Industry taking back money to spend there.

Joke in the Oil Industry, that people i know/meet dont realise Aberdeen is only 240,000 given the amount of Aberdonians they meet

Link to comment
Share on other sites

Biffer,

Some interesting thoughts about how the oil predicted to be on the west coast of Scotland is far too low at the moment

West Coast Oil

It will only last 100 years now ....... how will we manage?

Already seen it. I'm wanting to be able to explain to people how much of the value of that oil translates to cash to the treasury.

Link to comment
Share on other sites

Sir Ian Wood now saying only 15 years of Oil left, 2 days after Oil and Gas people stated that it really could be over 100 years

http://www.telegraph.co.uk/news/uknews/scottish-independence/11046740/Sir-Ian-Wood-15-years-of-oil-left-before-independent-Scotland-spending-cuts.html

Edit -I really should start looking at the dates of articles

So that makes him look an even bigger fraud

Edited by Ally Bear
Link to comment
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...


×
×
  • Create New...