Last year, the UK government introduced a windfall tax - called the Energy Profits Levy - to help fund its scheme to lower gas and electricity bills.The windfall tax only applies to profits made from extracting UK oil and gas. The rate was originally set at 25%, but has now been increased to 35%.Oil and gas firms also pay 30% corporation tax on their profits as well as a supplementary 10% rate. Along with the new windfall tax, that takes their total tax rate to 75%.However, companies are able to reduce the amount of tax they pay by factoring in losses or spending on things like decommissioning North Sea oil platforms.

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