Starmer calls windfall tax ‘inevitable’ as Tories show signs of wobbling over the levy

A government U-turn on a windfall tax is now inevitable, argued Labour leader Keir Starmer at Prime Ministers Questions.

Starmer taunted Prime Minister Boris Johnson at the despatch box, and said Johnson “can’t make his mind up” about a windfall tax on huge energy firm profits.

He said: “The working people across the country can’t afford to wait while he vacillates. It’s time to make his mind.”

The opposition has been calling for a one-off levy on North Sea oil and gas traders to help shave £600 per year from household energy bills.

Last night, Labour tabled an amendment to the Queen’s Speech backing a windfall tax on North Sea firms to help people who have been plunged into poverty amid the cost of living crisis.

However, MPs rejected the move by 310 votes to 248 – with Conservatives either rejecting the proposal or abstaining.

But Johnson’s stance has seemingly softened, and he told Parliament the government would “look at all sensible measures.”

Downing Street has spoken out consistently against a windfall tax, concerned it would reduce investment into the UK energy sector.

The government is desperate to ramp up domestic energy production, including renewables, nuclear and North Sea oil and gas as it looks to wean itself off overseas suppliers to meet its energy needs following Russia’s invasion of Ukraine.

BP and Shell have committed to investing £18bn and £25bn respectively in the domestic energy industry over the current decade.

Earlier this week, Tory MP and Treasury Select Committee chair Mel Stride has described the proposal as a “sensible measure” to ease household energy bills.

Internal government polling has found support for a windfall tax on the profits of energy firms is “wildly” popular. 

Research in Whitehall outlined that 80 per cent of those asked would back the move, as Rishi Sunak said yesterday “no option is off the table” if companies fail to invest in the UK’s energy sector.

He told the House of Commons that energy companies need to invest their “extraordinary profits” back into “British jobs, growth and energy security.”

The Telegraph reported that in the research, voters viewed big energy firms as “corporate cowboys”, amid pressure from Labour.

Last night, Labour accused Tory MPs of siding with ‘profiteering oil and gas companies’ after voting down a windfall tax in the Parliament yesterday.

This morning, foreign secretary Liz Truss told Sky News she was against a windfall tax because it might deter investment, and big firms such as BP, should be spending money on renewables instead. 

The UK registered 40-year high inflation this morning, at nine per cent, as calls were made to ease the cost of living crisis, including through the windfall tax on energy firms.