- As announced on 29 July 2024 and confirmed at the Autumn Budget 2024, the new chancellor Rachel Reeves made further changes to the EPL regime from 1 November 2024:
- an increase in the EPL rate from 35% to 38% for profits arising after 1 November 2024;
- an extension to the period to 31 March 2030;
- the removal of the investment allowance for EPL purposes, which was an additional 29% allowance generated by capital and certain operating expenditure;
- preservation of the first year allowances and the cash benefit of the investment allowance for decarbonisation expenditure under the EPL regime.
- The ESIM is kept in place and the government took the opportunity of the fiscal event to announce a consultation to take place in early 2025 into how the upstream oil and gas regime responds to oil and gas prices shocks after EPL ends. Certain technical changes were also confirmed to the decommissioning regime to facilitate the change of use of oil and gas fields for the purposes of carbon capture use and storage projects.
- Timing: following the chancellor’s Autumn Budget, the changes to the EPL regime are due to be legislated for in the next Finance Bill. The new consultation will be opened in early 2025.
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