§ Mr. Austin Mitchell
asked the Chancellor of the Exchequer what was the rate of exchange used in 124W converting dollars to pence in the reply of 9 February, Official Report, column 735, concerning the effect of a price increase on revenue from oil; and whether the whole or the revenue from fully taxed oil would arise in the first year, and with what delay.
§ Mr. Moore
The sterling/dollar exchange rate used in the reply of 9 February at column 735 was $1.423=1, the rate in force at the beginning of February.
The revenue from fully taxed oil consists of royalty, petroleum revenue tax (PRT) and corporation tax (CT). The additional royalty and PRT resulting from a price increase would be paid in the first year; the additional CT would normally be paid in the following year since the due date for CT payment is normally nine months after the end of a company's accounting period. The percentage of the extra revenue from oil on a fully-taxed basis which would be paid in the first year is 87 per cent. with the remaining 13 per cent., which relates to CT, normally being paid in the following year.