Alex Salmond tax plan to 'save 15,000 oil and gas jobs' in North Sea

FIRST Minister Alex Salmond has claimed that a series of SNP government measures to limit the impact of a multi-billion pound tax raid on the North Sea oil and gas industry would save 15,000 jobs.

Mr Salmond published a paper yesterday setting out a series of alternatives to a 2 billion windfall tax being imposed on oil and gas companies by the Treasury, which the First Minister warned would "severely" damage the sector.

He said the UK government should hand energy companies an "investment rate of return allowance" which guarantees firms a minimum rate of return on their investment in the North Sea, arguing that if "nothing was done" there would be 15,000 jobs lost and a risk to future investment in the industry.

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The SNP government's proposals attracted the backing of Scottish Labour leader Iain Gray, who warned that the UK government's tax hike would put tens of millions of pounds of investment in the oil and gas industry "in jeopardy". Mr Salmond, speaking at his official Bute House residence, Edinburgh, said other options to save jobs could be an "investment uplift allowance" which would also guarantee companies a minimum rate of return on investments before the tax was imposed.

Another suggestion set out in a paper from energy expert and Aberdeen University professor Alex Kemp, was for an "extended field allowances" which would reduce the amount of tax oil and gas firms pay on their profits.

However, the SNP government was unable to say how much the measures proposed by Mr Salmond yesterday would save the oil and gas industry.

The raft of proposals came after talks between Mr Salmond and Chancellor George Osborne, where the First Minister was invited to submit alternatives to the supplementary charge of 2bn on oil and gas companies - an increase from 20 per cent to 32 per cent.

Mr Salmond said: "If nothing was done about the supplementary charge, then the likelihood is there will be 15,000 less jobs than would have been the case without the supplementary charge. What that means in revenue terms is that over the next ten years there will be one billion barrels of oil and gas equivalent less.

"It is in no-one's interest to kill the goose that lays the golden egg, and if he's not exactly killing it, then he's in danger of severely disabling it, therefore I hope and believe he will listen."