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Gas Levy Act 1981
The Gas Levy Act 1981 (c. 3) is an Act of the Parliament of the United Kingdom which imposed on the British Gas Corporation a levy in respect of purchased natural gas. BackgroundIn May 1980 the Government announced[1] that it intended to impose a levy on the British Gas Corporation on gas purchased from the United Kingdom continental shelf (UKCS) and sold to the corporation under contracts which were not subject to petroleum revenue tax.[2] Virtually all the gas that came onshore from the UKCS was sold to the British Gas Corporation by the producers under long-term contracts signed before the oil crisis of 1973–74 and 1979–80 and the subsequent increase in prices. As a consequence, the prices paid for gas from these fields reflected the prices and the escalation clauses agreed in an era of cheap energy.[1] The average basic cost to British Gas of all its gas purchases in 1980–81 was about 8p a therm. The price paid by producers for new supplies or renegotiated contracts were more than twice that amount, together with provisions for increases in line with oil price increases. The government wished to ensure that gas prices reflected the costs of supply both then and in future.[2] Gas Levy Act 1981The Gas Levy Act 1981 received royal assent on 19 March 1981. Its long title is ‘An Act to impose on the British Gas Corporation a levy in respect of certain gas.’ ProvisionsThe act comprises seven sections:[3]
Working of the actThe government received £394.5 million from the British Gas Corporation for payments under the Gas Levy Act 1981 for the financial year 1981–82.[4][1] AmendmentSection 5A on Offences was subsequently included in the Act as a further Supplementary Provision (legislation unknown).[3] The rate of the Gas Levy was amended and continued by statutory instruments.[1] RepealThe Gas Levy Act 1981 was repealed by Section 153 of the Finance Act 1998 which abolished the Gas Levy. See alsoReferences
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