Tesco chairman breaks ranks to back windfall tax on energy giants
THE chairman of Tesco has called for a windfall tax to be levied on energy giants’ profits in a move he said would help households struggling with the soaring cost of living.
John Allan, who is also chairman of housebuilder Barratt Homes, is one of the most high-profile business leaders to speak publicly in favour of the policy which has been criticised by the Prime Minister as “a tax on business”.
Speaking to BBC Radio 4’s Today programme, Mr Allan said: “I think there’s an overwhelming case for a windfall tax on profits from those energy producers, fed back to those most in need of help.
“That’s the single biggest thing I think could be done.”
Mr Allan was also previously president of the Confederation of British Industry, the UK’S largest private business lobbying group.
He warned that people were facing “real food poverty for the first time in a generation” and that some Tesco customers have started rationing their food purchases as household incomes are squeezed. He said: “I was hearing for the first time in many years of customers saying to checkout staff: ‘stop when you get to £40’. They don’t want to spend a penny over that, as opposed to having everything checked out and settling the bill at the end.”
Asked whether a windfall tax would deter energy companies from investing in energy infrastructure, Mr Allan added: “They are expecting it [a tax] and I doubt they would actually be much fazed by it. It should be short-term only.” He said he was expressing a per- sonal view rather than Tesco’s view.
His intervention comes amid a growing chorus of politicians and campaigners calling for a one-off tax as energy companies report record profits on the back of soaring energy prices following Russia’s invasion of Ukraine.
Last month, Rishi Sunak, the Chancellor, threatened energy companies with a windfall tax unless they “support the economy” by increasing investment in UK energy supply.
Mr Sunak said that, unless big firms do more to protect energy security, levying a windfall tax was “something I’d look at”. His comments were at odds with views expressed by Boris Johnson and Kwasi Kwarteng, the Business Secretary, who said such a policy would “destroy investment”.
Ministers have refused to rule out a windfall tax, with George Eustice, the Environment Secretary, saying last week that energy firms were paying enough tax “for now” but said the matter would be kept “under review”.
Mr Allan also criticised Mr Sunak for raising National Insurance. He said: “If I’d been the Chancellor, I wouldn’t have done it. I think hitting people on modest incomes disproportionately is absolutely the wrong time to do it.”