Is George Osborne right about the North Sea tax?

Labour argues that the windfall tax could be passed to customers – but this is not an effective line

George Osborne has said that the new windfall tax on oil companies will not be immediately passed on to motorists in higher fuel prices.

The Chancellor announced a £2bn levy on North Sea oil producers in yesterday's Budget to pay for a cut in fuel duty.

Labour's attack line was that there was nothing to stop oil companies from increasing prices and passing on the tax. The shadow chief secretary to the Treasury, Angela Eagle, made this case on Newsnight last night, while Ed Balls also criticised the move, asking on Radio 5 Live: "Will this immediately be passed back to customers?"

On Newsnight with Eagle last night, Danny Alexander argued that this would not be the case because petrol stations buy their oil on the global oil market, which is unaffected by the firms in the North Sea.

This morning on the Today programme, Osborne reiterated this point:

We've got an international oil market. The petrol that you put in your car doesn't just come from the North Sea, it comes from the Middle East, Russia and so on.

How confident can they be? Over at PoliticsHome, Paul Waugh has dug out the source of this information – a regulatory impact assessment carried out in 2006, the last time there was a tax rise on North Sea oil. This document says:

Oil companies are price-takers, facing a globally determined market price for their output, and so will absorb all costs. They will be unable to pass any costs on to consumers, and the impact will be distributed proportionately across producers with no adverse effects on competition.

It looks like Osborne is safe on this one, with another Labour line of attack stymied (ensuring that the banks would not benefit from the cut in corporation tax was another skilful move).

However, this certainly does not mean that the policy is watertight. Both Balls and Ed Miliband have pointed out that the penny cut in fuel duty is meaningless, given that the VAT hike in January already added 3p to the cost of petrol.

Waugh also notes that punters were complainin this morningg that petrol stations put prices up yesterday morning before taking a penny off last night. Osborne said he would be watching retailers "like a hawk" to stop any "funny business". He better get watching.

Samira Shackle is a freelance journalist, who tweets @samirashackle. She was formerly a staff writer for the New Statesman.

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We're running out of time to stop a hard Brexit - and the consequences are terrifying

Liam Fox has nothing to say and Labour has thrown the towel in. 

Another day goes past, and still we’re no clearer to finding out what Brexit really means. Today secretary of state for international trade, Liam Fox, was expected to use a speech to the World Trade Organisation to announce that the UK is on course to leave the EU’s single market, as reported earlier this week. But in a humiliating climb-down, he ended up saying very little at all except for vague platitudes about the UK being in favour of free trade.

At a moment when the business community is desperate for details about our future trading arrangements, the International Trade Secretary is saying one thing to the papers and another to our economic partners abroad. Not content with insulting British businesses by calling them fat and lazy, it seems Fox now wants to confuse them as well.

The Tory Government’s failure to spell out what Brexit really means is deeply damaging for our economy, jobs and global reputation. British industry is crying out for direction and for certainty about what lies ahead. Manufacturers and small businesses who rely on trade with Europe want to know whether Britain’s membership of the single market will be preserved. EU citizens living in Britain and all the UK nationals living in Europe want to know whether their right to free movement will be secured. But instead we have endless dithering from Theresa May and bitter divisions between the leading Brexiteers.

Meanwhile the Labour party appears to have thrown in the towel on Europe. This week, Labour chose not to even debate Brexit at their conference, while John McDonnell appeared to confirm he will not fight for Britain’s membership of the single market. And the re-election of Jeremy Corbyn, who hardly lifted a finger to keep us in Europe during the referendum, confirms the party is not set to change course any time soon.

That is not good enough. It’s clear a hard Brexit would hit the most deprived parts of Britain the hardest, decimating manufacturing in sectors like the car industry on which so many skilled jobs rely. The approach of the diehard eurosceptics would mean years of damaging uncertainty and barriers to trade with our biggest trading partners. While the likes of Liam Fox and boris Johnson would be busy travelling the world cobbling together trade deals from scratch, it would be communities back home who pay the price.

We are running out of time to stop a hard Brexit. Britain needs a strong, united opposition to this Tory Brexit Government, one that will fight for our membership of the single market and the jobs that depend on it. If Labour doesn’t fill this gap, the Liberal Democrats will.

Tim Farron is leader of the Liberal Democrats.