By Shadia Nasralla

LONDON – The UK government’s 5 billion pound ($6.29 billion) tax plan for oil and gas producers includes incentives for those producers to pump more fossil fuels, which has angered climate activists calling for the tax.

Tax collections for oil and gas producers, including a new additional 25% levy on profits, can be reduced significantly by increased investment particularly in oil and gas projects.

“Within the levy, a new ‘super deduction’ style allowance was introduced to encourage companies to invest in UK oil and gas extraction,” the Government Treasury said in a fact sheet announcing the scheme on Thursday. He did not list other types of energy investments, such as renewable energy or recharging electric cars.

“The new investment allowance will mean businesses get a tax savings of 91 pence for every pound they invest,” the Treasury said.

The UK government has committed to becoming a carbon neutral economy by 2050. The UK government is also hosting a climate summit police 26 last year, in which countries were urged to eliminate inefficient fossil fuel subsidies.

At the same summit, he turned down an invitation to join other oil and gas producing countries in their efforts to ban the extraction of hydrocarbons.

Thursday’s announcement that additional taxes on oil and gas producers included tax incentives for higher production tarnished the move in the eyes of climate activists.

“Pricing the extraction of oil and gas, while doing nothing to encourage investment in renewable energy, will not provide energy security, will drive up the bill further and will add fuel to the fires of the climate crisis,” said Ami McCarthy, Greenpeace UK head of political campaigns. .

Steve Trent, founder of the Foundation for Environmental Justice, said the tax was a positive step in helping households cope with rising energy costs.

“But there is a legal vacuum. Oil and gas companies can largely avoid taxes by increasing investment in extracting more fossil fuels in the UK,” he said.

(1 dollar = 0.7952 pounds)