The United Kingdom’s net revenues from taxes levied on oil and gas companies operating on or near the North Sea turned negative “for the first time since records began in 1968,” according to a report by London-based Argus Media.
The government collected about $790.5m during the 2015-16 fiscal year, but a change in tax rules and enforcement, coupled with chronically low oil prices, meant more money went out through investments and subsidies, than went in.
The negative figure for petroleum tax revenues is made possible by the fact North Sea firms are able to carry back losses indefinitely to earlier periods, reducing liabilities and leading to tax repayments.
Earlier this year, North Sea operators turned unprofitable, according to an announcement by the Office of National Statistics. The BBC estimates that up to 24 billion barrels of oil remain in the North Sea, Oil Price wrote.