The North Sea oil industry is proving to be pretty expensive of taxpayers with it slurping out maximum amount from the pocket of taxpayers. Last year it cost £312 mn to taxpayers as revenues rushed into red for the very first time. As per the HM Revenue and Customs, it is the worst ever scenario since its advent 50 years back. The blame of the lost tax was put on the declining production scenario, high costs of operations, and low prices of oil. HMRC also reported that the revenue of the government have decreased to £312 mn in 2016-2017 from £10.9 bn in 2011-2012. Rising investments in new projects as well as working on the current developments is leading to high level of expenditure.
The government revenues also faced significant decline owing to the 10% decrease in the production of oil and gas and halving of the price of oil between 2011-2012 and 2016-2017. The petroleum revenue taxes dropped down to £650 mn from £562 mn. On the other hand, the corporation tax went below over half of its earlier state to £338 mn from £713 mn. The data that was published last year projected that 2015-2016 would be the very first time when tax revenue are expected to drop into red with an expected loss of approximately of around £21 mn.