Jeremy Hunt has admitted that the Scottish oil and gas industry are the big “losers” in his budget.
As well as angering the industry, the comments from the Chancellor will likely further infuriate the already fizzing Scottish Conservatives.
They'll also likely be leapt on by the SNP, who are challenging the Tories for three seats in the North East.
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In his Spring Budget, the Chancellor confirmed that the sunset clause on the Energy Profits Levy would be pushed back a year to March 2029, raising £1.5 billion, helping to pay for his 2p cut to National Insurance.
But industry bodies have warned that it puts thousands of jobs lost at risk and could see millions of pounds of potential investment lost.
Douglas Ross has already said he is “deeply disappointed” by the extension and that he will vote against the measure in the Commons.
Energy Minister Andrew Bowie, who is defending a majority of just 843 in his West Aberdeenshire and Kincardine seat, also said he was disappointed by the measure, though he has so far refused to say if he will vote against the legislation needed to delay the levy end date.
Doing so would mean quitting his government role.
During an interview with the BBC’s Today programme, Mr Hunt was asked who the “losers” were in his budget.
"Who are the losers? I'm trying to answer your question directly. Foreigners who are resident in the UK who are able to pay a check and avoid paying tax at the same rate as everyone else, the so called non-doms.
"They are going to be paying significantly more tax.
"I've also asked the Scottish oil and gas industry to pay an additional contribution because the war in Ukraine is lasting longer.
"Oil and gas prices are going to stay higher for longer. I think it's fair they can make an additional contribution."
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Earlier, during an interview with the BBC's Good Morning Scotland, he was asked directly if he had thrown Scottish Tory MPs in the north-east of Scotland “under a bus.”
The Chancellor said: “No,” but added: “I appreciate it was a difficult decision for them.”
He said the UK Government still “strongly supports the oil and gas industry”, but added: “I also had to be fair looking at the public finances, looking at the fact that I have spent, taxpayers have spent, £94 billion in cost-of-living support, helping pay around half people’s electricity bills over the last winter, and reflecting the fact that because high oil and gas prices have lasted longer than was anticipated at the start of the Ukraine war, they are making additional profits they weren’t expecting to make.”
Speaking to journalists at the Scottish Tory conference over the weekend, Mr Ross warned that extending the windfall tax would be “an unacceptable blow” to the industry and workers.
He said he had and would continue to make that case "most strenuously to the Chancellor."
Despite this, Mr Hunt was not for shifting.
Writing in the The Press and Journal, Mr Ross said he would "continue to fight tooth and nail to persuade the UK Government to think again."
He added: “The more energy companies are taxed, the less they will have to invest in managing the transition to net zero and the creation of further Scottish jobs.
“I want our energy policy focused on the long-term, rather than just the here and now. I share the frustration of major employers in the north-east that the one-year extension is unhelpful and hinders their investment planning.
“That is why I will not vote for an extension when it comes to Parliament.”
Mr Sunak first announced the windfall tax - set at 65% - back in May 2022 after Russia’s invasion of Ukraine led to a surge in wholesale and retail energy prices.
He always insisted it would be temporary and was due to end next year.
However, after Liz Truss’s mini-budget crashed the economy, Mr Hunt increased the rate to 75% and extended it for a further two years to 31 March 2028.
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Responding to the Chancellor's "loser" remark, Ryan Crighton, policy director at Aberdeen & Grampian Chamber of Commerce, said: “When the dust settles, Jeremy Hunt may find that the biggest budget loser is in fact the Treasury, because the investment that he could have attracted to the North Sea was far greater than the £1.5billion he has grabbed.
“The Chancellor had two choices yesterday – strangle more cash from a sector already paying tax at nearly four-times the rate of every other business in the UK, or create the fiscal conditions that would unlock £200billion of investment in our energy sector.
“This is the fourth time energy taxes have been tinkered with in 18-months – and for a sector which relies on stability to make long-term investments, that is unacceptable.”
The SNP Westminster leader Stephen Flynn said the Chancellor had "let the cat out the bag."
He added: "Westminster has once again sold out the North East of Scotland to fill the pockets of the UK Treasury - with the OBR confirming they will rake in a further £20.6 billion from Scotland's natural resources by 2029.
"Not to mention threatening to destroy Scottish jobs and Scotland's energy transition - something Sir Keir Starmer's Labour Party now fully support.
"In contrast, the SNP want to see all of Scotland's energy wealth spent in Scotland to lower household energy bills and invest in the green energy projects of the future - not nuclear power plants in England.
"We want to make Scotland’s energy work for Scotland, not Westminster.
"The Chancellor has humiliated his Scottish Tory colleagues and destroyed any last remnants of credibility the Tories had in the North East of Scotland.
"Unlike the Tories and Sir Keir Starmer's Labour Party, the SNP will defend Scottish jobs, stand up for Scotland's values and demand the best deal for families across Scotland."
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