SERICA Energy’s chairman has said Labour’s tax plans for the North Sea mean “companies like Serica won’t invest”.
David Latin also warned that “there will a lot of job losses” that would follow declining investment.
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Speaking to BBC Radio 4, Mr Latin said Labour’s announcement to remove investment allowances had been expected, but highlighted the primary issue as “uncertainty around capital allowances”.
He added: “Significant reductions could be announced in the October budget but we’re left not knowing how big those may or may not be,” he added.
“Capital allowances mean that businesses can offset investments against tax. If the ability to do this is reduced then companies like Serica won’t invest”, said Mr Latin.
Rachel Reeves is set to bring her first full budget to parliament on October 30.
Mr Latin continued: “What’s going to happen if we don’t invest is there will actually be less tax revenues, there will be a lot of job losses, there will be reduced security and it will be worse for the environment.
“One of the things, perhaps, to consider is this production that’s declining, it’ll nosedive off the cliff if we take the investment away and at the bottom of the cliff there’s a heard of elephants waiting and those elephants are called decommissioning.”
