RE: Windfall tax on those profiting from the war on Iran to tackle the cost of living crisis
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Dear Prime Minister and Chancellor,
RE: Windfall tax on those profiting from the war on Iran to tackle the cost of living crisis
Across the UK, millions are barely staying afloat. Energy bills are bursting family budgets, childcare costs are washing away wages, businesses are struggling, and housing costs have skyrocketed. Many of the greatest problems people in the UK are facing right now will intensify as the impacts of the war on Iran continue to ripple through the economy.
The US-Israeli strikes on Iran as part of an illegal war, have caused chaos, killed civilians and have triggered the largest ever disruption to fuel supply, according to the International Energy Agency, sending crude oil costs surging over $100 per barrel in recent days. This has only worsened after the recent attacks on gasfields and LNG processing facilities in Iran and Qatar, which have caused gas prices to jump to four-year highs, with the impacts to be felt for many months and years to come.
Domestically, UK gas prices have more than doubled since late February. They are now at their highest since August 2022 and are likely to drive up energy bills unless action is taken to protect households and businesses when the next price cap is determined. Meanwhile, households are already grappling with the impacts of jumping fuel price increases, making simply getting by increasingly expensive. At the same time, experts are predicting major disruption to production and imports for agriculture inputs like fertilisers, risking further affordability issues for food and drink essentials in the months to come.
This crisis makes clear that the UK must end its reliance on fuels imported from overseas and invest in domestic renewable energy, to ensure British energy security is not left susceptible to global conflicts, disasters, or trade disputes. This will also help accelerate the UK’s transition toward a low-carbon economy, thereby reducing the likelihood of further economic shocks.
Sadly, there are some clear winners of the war on Iran. Oil and gas giants, big banks, agricultural input industries and defence companies will likely make record profits, at the expense of enormous human suffering. In recent crises, like those triggered by the Covid-19 pandemic and war in Ukraine, the wealthiest households and super-rich amassed even greater fortunes - to the tune of hundreds of billions of pounds, while millions were left struggling. Time after time, when wars break out, or major crises unfold, companies across different sectors, alongside super-rich individuals, make eye-watering sums of money. North Sea energy firms are set to make bumper profits. According to new data, for every month that energy prices remain at 18th March 2026 levels, profits could result in over £200m in tax revenue through the Energy Profits Levy. Banks reap profits due to the Bank of England’s misguided decision to raise interest rates in response to supply-side inflation. Higher rates are paid by borrowers - whose mortgage costs are already soaring off the back of the Iran crisis - and the Bank of England itself, which pays interest on the risk-free reserves banks hold with them. The latter cost is ultimately borne by the Treasury, currently to the tune of £20bn per year.
It is not right that extraordinary profits, generated off the backs of ordinary people during periods of crisis, are siphoned off into private hands and corporate bank accounts. All whilst households and businesses are in urgent need of substantial support to cope with the affordability crisis. The government’s own cost of living champion has called for measures to prevent profiteering. We urge you to make this crisis a turning point for the UK. Taking bold action to systemically reform our tax system and invest in our energy security will build resilience in our economy to
withstand future shocks and make life affordable for people and businesses in the UK.
We are writing to you today, as leading organisations from civil society, urging you to:
Ensure a permanent and strengthened energy profits mechanism which captures all excess profits made by oil and gas companies - including windfalls during crises - and close all loopholes which encourage further investment in harmful fossil fuels.
Introduce a levy on banks specifically targeting UK retail net income, profits they have made directly from the UK public.
Apply additional excess profits (windfall) taxes to companies in sectors profiteering from this crisis and the war in Iran, for example big agribusiness, the defence industry and associated AI and tech firms.
Invest revenue from excess profits into direct support to households and businesses to help weather the shock of the affordability crisis, alongside accelerating bringing online mass-scale low and zero carbon solutions to build a resilient energy system in the UK.
The billions in revenue from the additional proposed taxes on windfalls from this crisis must be reinvested into providing direct cost of living support and making our economy more resilient to withstand shocks in the future.
We can break free of the war-energy crisis doom loop, invest in renewables and low-carbon solutions, support people to deal with the cost of living crisis and put Britain on a path to better living standards for everyone in this country.
Yours sincerely,
Adrian Ramsay MP co-signed this letter along with Sian Berry MP, Carla Denyer MP, Hannah Spencer MP and Dr Ellie Chowns MP. Tax Justice UK, Faiza Shaheen, Executive Director
Greenpeace UK, Areeba Hamid, Co-Executive Director
Global Witness, Mike Davis, CEO
Women’s Budget Group, Dr Daniella Jenkins, Executive Director
National Education Union, Daniel Kebede, General Secretary38Degrees, Matthew McGregor, CEO
PCS Union, Fran Heathcote, General Secretary
Positive Money, Sara Hall, Co-Executive Director
End Fuel Poverty Coalition, Simon Francis, Coordinator
Global Justice Now, Nick Dearden, Executive Director
Autonomy Institute, Will Stronge, Chief Executive
Patriotic Millionaires UK, Rebecca Gowland, Executive Director
Green New Deal Rising
350.org, Anne Jellema, Executive Director
Zero Hour, Amy McDonnell and James Sutton, Co-Executive Directors
Care Full, Ruth Hannan & Hannah Webster, Co-Directors
Stamp Out Poverty, David Hillman, Director
War on Want, Liz McKean, Executive Director
Fairness Foundation, Will Snell, Chief Executive
Compass, Lena Swedlow, Deputy Director
Equality Trust, Priya Sahni-Nicholas and Jo Wittams; Co-Executive Directors
Taxpayers Against Poverty, Tom Burgess, CEO
Debt Justice, Heidi Chow, Executive Director
Fuel Poverty Action, Stuart Bretherton, Campaigns Lead
Mainstream
Women’s Environmental Network, Kate Metcalf, Co-Director
Voices Adfocad, Mike O'Brien, Founder
Tipping Point UK, Louise Hazan, Co-Director
Wellbeing Economy Alliance Scotland, Lisa Hough- Stewart, Interim Director
WEAll Global, Stewart Wallis, Executive Co Chair
Culture Unstained, Chris Garrard, Co-Director
Possible, Hirra Khan Adeogun & Juliet Michaelson, Co-directors
Cost of Living Action, Conor O'Shea, Campaign Coordinator Financial Transparency Coalition, Matti Kohonen, Executive Director
Conflict and Environment Observatory, Doug Weir, Director
JustMoney Movement, Sarah Edwards, Executive Director
Tipping Point North South, Deborah Burton. Co-founder
New Economics Foundation, Danny Sriskandarajah, Chief Executive
CLES (Centre for Local Economies), Dr Sarah Longlands
Oil Change International, Elizabeth Bast, Executive Director
