Chancellor blew chance to end Energy Profits Levy, say opposition parties

The SNP and Tories have attacked the Chancellor for choosing not to axe the energy windfall tax in her spring statement.

The two parties have been calling for Rachel Reeves to end the Energy Profits Levy – something Labour expanded when it won the last general election.

Industry bodies have warned the tax is costing the North Sea oil and gas sector jobs, while harming the economy and tax intake.

The Conservatives warned Labour they had missed an opportunity to “reset the dial” in the North Sea.

The Scottish Government urged the UK Government to change its position.

Scottish Finance Secretary Shona Robison said: “It is very disappointing that the Chancellor does not appear to have heeded repeated warnings from across the energy industry on the urgent need to remove the tax grab on Scotland’s energy.

“When she meets North Sea industry leaders, she must announce an end to this tax on Scotland’s energy to prevent further loss of jobs and investment.

“In order to provide the necessary certainty and stability, an immediate end date needs to be legislated on at the earliest possible opportunity.

“Amid continued global instability, many households and businesses will be looking for reassurance that their costs won’t increase further.

“Fuel duty is a key concern and the Chancellor has failed to provide that reassurance. This emphasises the need to urgently engage in meaningful four-nations discussions on motoring taxation, as we have repeatedly called for.

“Families will also be worried about increased energy bills given the ongoing international situation, which risks worsening a situation in which people are already struggling to pay their bills.

“Again, it is disappointing that the Chancellor appeared to have no answers for those households.”

Andrew Bowie, the Tories’ shadow energy minister, said the conflict in the Middle East showed why the UK had to prioritise its own energy.

He said: “When the minister comes to cut the ribbon on the GB Energy office in Aberdeen, they might as well switch the lights off. It’ll save them some money.

“This was an opportunity for Labour to reset the dial when it comes to North Sea oil and gas.

“Events in the Middle East over the past few days have shown domestic energy security to be crucial.

“So, the complete black hole of activity toward ditching the Energy Profits Levy, even just making it easier for companies to operate from Britain, has shown this Government’s path will not change.

“Even when the levy runs dry, making pennies, Labour will be there to collect.

“But that’s a Keir Starmer Government for you.”

During her statement, Ms Reeves insisted her plan for the economy was working to restore stability in an “uncertain” world.

She outlined updated growth forecasts from the Office for Budget Responsibility, which downgraded growth for 2026 to 1.1%, from 1.4%. The next two years are expected to see slightly higher growth with the Chancellor saying the overall economic outlook remains “largely unchanged”.

The Scottish Chambers of Commerce (SCC) welcomed the Chancellor’s “steady” statement but described it as a “fiscal non-event”.

Charandeep Singh, SCC chief executive, said: “While new policy announcements might make for more exciting headlines, recent experience shows that volatility in fiscal policy can undermine business confidence, force employers to scale back their expansion plans, and have adverse impacts on jobs and wages.

“That is why entrepreneurs will welcome this fiscal non-event. Predictability allows businesses to plan, invest, and grow and that, in itself, is economically valuable.”

Mr Singh added: “The autumn budget must be the moment to move from stability to strategy: SCC will call on the Treasury to deliver a clear, long-term fiscal framework that restores competitiveness, strengthens energy security, and unlocks investment.”

The Federation of Small Businesses warned the Chancellor that her spring statement would not address the increasing costs facing firms.

Guy Hinks, the group’s chair, said: “The small businesses which are the backbone of the Scottish economy need to see measures to ease these enormous cost pressures in order to support jobs and growth.

“Given the global events of recent days, if there is another energy price crisis, the UK Government must stand ready to support small business energy consumers with similar measures to those introduced in the last price spike.

“Closer to home, we have set out a range of practical steps the next Scottish Government can take in our Scottish Election 2026 manifesto to support our 370,000-plus small businesses with their costs burden.”