Tuesday, August 27, 2013

If Britain wants an American-style energy boom, it should import American-style local taxation

The Economist:  Fracking has boomed in America partly because local people have been paid off handsomely. Landowners can sell the rights to the hydrocarbons under their fields. States tax extracted oil and gas, and redistribute much of the revenue to the affected counties, which spend it on glorious schools and fire stations... In centralised Britain, by contrast, almost all the proceeds from fracking that do not flow to miners would end up in the Treasury’s coffers. Oil and gas rights are held in effect by the crown, not landowners. George Osborne, the chancellor of the exchequer, sets the tax on shale-gas production: it is 30%, much lower than taxes on North Sea fields...

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