Ken Cronin doth protest too much methinks
The BBC reported this week that Greater Manchester’s Police and Crime Commissioner, Tony Lloyd, had made the perfectly reasonable point that shale gas exploration firms should pay a levy towards the cost of policing anti-fracking protests, because they stand to make “huge sums of money” out of their work. (Of course the question of whether the police are needed there is such huge numbers is an other issue entirely)
“Since they’ll be making big bucks, they [should] put something back into the kitty,” he said.
The BBC continued
Ken Cronin, of the UK Onshore Operators Group (UKOOG), said a levy would set a “worrying precedent”.
The chief executive of UKOOG, a representative body for the UK onshore oil and gas industry, said it would constitute paying the costs of police protection from individuals who were preventing them going about their lawful and permitted business.
He said: “Like all business sectors the onshore oil and gas industry pays tax and in the case of onshore oil and gas this is currently set at 62%.
Of course technically Mr Cronin is right – the default rate is 62%, but surely he can’t fail to be aware that George Osborne’s Autumn Statement carried the following good news for the frackers –
The Autumn Statement said the UK shale gas tax regime would be “the most competitive in Europe” and would also have an “effective tax rate for shale gas projects lower than in the US”.
The new tax breaks are structured so that when a shale gas firm starts making taxable profits from selling gas, it will be taxed at 30 per cent rather than the usual 62 per cent. The allowance lasts until such a time as their taxable profits equal 75 per cent of money spent developing project.
So for a project costing £100 million, a company would be eligible for the reduced rate for their first £75m of taxable profits – saving them £24m.
Now, given that huge handout of which he is obviously aware, is this really the best Mr Croning’s can do? Is this his best response to the idea that the frackers should cough up some of their profits to pay for policing the legitimate protests which result from their invasion (and which is really only an extension of the “the polluter pays” principle)? If so they are on very shaky ground, and I am not talking about earth tremors here.