After posting enormous global profits in 2017, Shell has announced that it will pay tax in the UK for the first time since that year.
To recoup part of the enormous gains firms received from high oil and gas prices, governments have put taxes on energy companies.
At this time, Shell won’t say how much UK tax it will ultimately have to pay.
At this point, it is recognised that the number may be less than expected.
After accounting for losses, investing in sectors like renewable energy or decommissioning North Sea oil rigs, oil and gas corporations may pay less tax in the UK.
Shell recorded a significant increase in profit last year, reaching $9.5 billion globally between July and September.
At the time, Shell claimed that because it had made significant investments in the UK, it had not generated a profit there and was not subject to taxation.
However, the business acknowledged on Friday that it does anticipate paying some tax in the UK for the first time since 2017.
It comes after the government raised the Energy Profits Levy, sometimes known as the windfall tax, from 25% to 35% in November.
It comes after the government raised the Energy Profits Levy, sometimes known as the windfall tax, from 25% to 35% in November.
Shell did not specify how the $2 billion reduction to its 2022 fourth-quarter earnings would be distributed between the UK and the EU.
After the Covid lockdowns ended, oil and gas prices started to rise, but they really took off after Russia invaded Ukraine.
As a result, energy firms like Shell and BP made huge profits in 2022.
After earning a $30 billion profit for the first nine months of last year, Shell is still on course for record annual profits in 2022, despite having to pay higher taxes.
The business stated that it anticipates paying between $4.3 billion and $4.7 billion in global taxes over the last three months of 2022.
Rival BP announced that it would pay $800 million in windfall tax in 2022.
On February 2, it must release all of its results for the financial year of 2022.
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