The Petroleum Royalties (Relief) Act 1983 (c. 59) is an Act of the

Parliament of the United Kingdom The Parliament of the United Kingdom is the supreme legislative body of the United Kingdom, the Crown Dependencies and the British Overseas Territories. It meets at the Palace of Westminster, London. It alone possesses legislative suprema ...

which exempted certain petroleum licence holders of new offshore oil and gas fields from the payment of petroleum royalties or the delivery of petroleum.

Background

In the Budget statement in 1983 the

Chancellor of the Exchequer The chancellor of the Exchequer, often abbreviated to chancellor, is a senior minister of the Crown within the Government of the United Kingdom, and head of His Majesty's Treasury. As one of the four Great Offices of State, the Chancellor is ...

announced changes to the taxation in the oil industry. He noted that Government had a responsibility to compare the likely returns from future development both to the Government and to the industry, and had to ensure that the country obtained the appropriate benefit. The demarcation line between the direct benefit to the nation and the benefit to the oil and gas industry work was such that, after the Budget measures and taxation proposals and the measures in this Act the nation would obtain the majority of the benefit. Petroleum revenue tax was 75 per cent, and

corporation tax A corporate tax, also called corporation tax or company tax, is a direct tax imposed on the income or capital of corporations or analogous legal entities. Many countries impose such taxes at the national level, and a similar tax may be imposed at ...

was 52 per cent. The measures in this Act meant that benefit from other discoveries and developments will benefit the nation as a whole. As a result of the application of royalties for future developments outside the southern basin of the

North Sea The North Sea lies between Great Britain, Norway, Denmark, Germany, the Netherlands and Belgium. An epeiric sea on the European continental shelf, it connects to the Atlantic Ocean through the English Channel in the south and the Norwegian S ...

, the marginal tax rate for a field paying petroleum revenue tax will be reduced from 89.5 to 88 per cent. Oil production increased and the Government's revenue from North Sea taxation in 1984/5 was £12 billion or 8 per cent of total tax revenue. In response to the oil price fall in 1986 the Government reduced taxation further by enacting the '' Advance Petroleum Revenue Tax Act 1986.''

Petroleum Royalties (Relief) Act 1983

The Petroleum Royalties (Relief) Act 1983 (1983 chapter 59) received

Royal Assent Royal assent is the method by which a monarch formally approves an act of the legislature, either directly or through an official acting on the monarch's behalf. In some jurisdictions, royal assent is equivalent to promulgation, while in other ...

on 21 December 1983. Its long title is ‘An Act to confer on holders of petroleum production licences an exemption from royalties (including royalties in kind) in respect of petroleum from certain new fields off the coast of Great Britain.’

Provisions

The Act comprises two Sections: * Section 1. Royalty exemption for petroleum from certain new offshore fields. * Section 2. Short title, commencement and extent.

Subsequent legislation

Section 1 of the 1983 Act was extended by '' Petroleum Royalties (Relief) and Continental Shelf Act 1989'' (c. 1) Section 1 of the 1983 Act was amended by ''

Petroleum Act 1998 The Petroleum Act 1998 is an Act of the Parliament of the United Kingdom which consolidated arrangements for the licensing, operation and abandonment of offshore installations and pipelines. As a consolidation Act, it did not change the substant ...

'' (c. 17)

References

*"Petroleum Royalties (Relief) Act 1983". Halsbury's Statutes of England and Wales. Fourth Edition. 2009 Reissue. LexisNexis
Volume 17(1)
Pages 714 and 715. *"The Petroleum Royalties (Relief) Act 1983". Halsbury's Statutes of England. Third Edition. Butterworths. London. 1984
Volume 53 (Continuation Volume 1983)
Pages 896 and 897. See also pages 654, 1356 and 1410. *Peter Allsop (ed). "Petroleum Royalties (Relief) Act 1983"
Current Law Statutes Annotated 1983
Sweet & Maxwell. Stevens & Sons. London. W Green & Son. Edinburgh. 1984. Chapter 59. Pages 59/1 and 59/2.
Is it in Force? 2003
Butterworths. 2003. Page 140. *"Petroleum Royalties (Relief) Act 1983" (1984
103
Law Notes 41 (February 1984) *W P Winston
Petroleum Law Guide 1985
Elsevier Applied Science Publishers. Page 40. *Bernhard Taverne. An Introduction to the Regulation of the Petroleum Industry. 1994. Page 55
Google Books
*Gordon, Paterson and Üşenmez. Oil and Gas Law: Current Practice and Emerging Trends. Second Edition. 2011. Reprinted 2014. Paragraph 6.4 at page
138
and 139. *Terence Daintith and Leigh Hancher. Energy Strategy in Europe: The Legal Framework. Walter de Gruyter. Berlin. New York. 1986
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*Taylor and Winsor on Joint Operating Agreements
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Longman. 1992. Page iii. *John Pointon and Derek Spratley. Principles of Business Taxation. Clarendon Press. 1988. Page 260
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{{Authority control United Kingdom Acts of Parliament 1983 History of the petroleum industry in the United Kingdom