THE next UK government should consider scrapping the supplementary charge on oil and gas companies to boost the sector, according to the Centre for Policy Studies think tank.

The tax, effectively an additional payment on top of corporation tax, was cut at the March Budget from 30 per cent to 20 per cent.

The CPS also called for "more imaginative" use of investment allowances to encourage the development of mature fields.

In addition the organisation suggested any future fiscal regime for the sector should take account of oil price variability.