IT has been one of the most divisive policies of the last 12 months.

The UK Government imposed a windfall tax on the oil and gas industry in May of last year, following pressure from opposition politicians and campaigners outraged at the huge profits companies were making largely because prices had soared in the wake of Russia’s assault on Ukraine.

As the profits rolled in, the energy profits levy, to give it its full name, was extended further in November, with opponents angry that shareholders and bosses were earning huge sums of money while so many people were struggling to pay their energy bills.

READ MORE: Famous Scottish crisps on sale under new brand name

At the same time, however, the voices from the industry over the effects of the taxation were becoming ever shriller.

Major producers warned the tax has made the North Sea less competitive place to do business and would lead companies to invest in other geographical areas where tax regimes are less burdensome, putting jobs at risk. They also argued that it would ensure the UK remained reliant on costly energy imports, at a time when Russia’s war on Ukraine has demonstrated the importance of generating domestic supplies.

Both sides of the argument have their place and, predictably, the reaction to today’s news that the UK Government is to slash the windfall tax has been split. Industry groups have welcomed the planned reduction as a step in the right direction but feel ministers should go further to safeguard the competitiveness of the North Sea and thus jobs. Anti-poverty campaigners, on the other hands, say energy bills remain too high and that talk of cutting the tax while so many struggle to pay bills is premature.

READ MORE: Scottish transport giant shrugs off loss of major rail contract

Those against cutting the windfall tax also include environmental campaigners, with the Scottish Greens declaring today the UK Government had profits before the planet. Spokesman Mark Ruskell MSP suggested that “shareholder driven corporations” should be taxed even higher “to redress the environmental destruction they have wrought on our environment for decades”.

The situation is extremely complex, and it would seem impossible for policy makers to come with an approach that can satisfy the interests of all concerned. But it is understandable why an attempt is being made by ministers to protect jobs, investment and, crucially, a steady supply of domestic energy following 12 tumultuous months.