Liz Truss has doubled down on her opposition to imposing a windfall tax on the excess profits of oil and gas companies as she faced MPs for the first time as Prime Minister.
Opposition parties and campaigners have called for energy giants to contribute towards keeping costs down for families struggling across the UK.
Truss told MPs that she will be making a statement in the House of Commons on Thursday regarding energy bills – expected to entail a freeze on the energy price cap as it currently stands.
However, at Prime Minister’s Questions on Wednesday, she was pressed on how she intended to pay for the plan.
Labour leader Keir Starmer told Truss that an energy price freeze will not be cheap to implement.
In his first question to Truss as Prime Minister, Starmer asked: “When she said in her leadership campaign that she was against windfall taxes, did she mean it?”
Truss responded: “I am against a windfall tax, I believe it is the wrong thing to be putting companies off investing in the United Kingdom just when we need to be growing the economy.”
The Labour leader pressed Truss over whether she intends to leave the vast excess profits of energy companies on the table.
He said: “I asked because the Treasury estimates are that the energy producers will make £170bn in excess profits over the next two years.
“The Prime Minister knows she has no choice but to back an energy price freeze, but it won’t be cheap and the real choice, the political choice, is who is going to pay.
“Is she really telling us that she’s going to leave these vast excess profits on the table and make working people foot the bill for decades to come?”
Truss argued for the need to increase the UK’s energy supplies in the long-term, as she stated her intention to open up more supply in the north sea.
She responded: “I understand that people across our country are struggling with the cost of living and they’re struggling with their energy bills.
“And that is why I as Prime Minister will take immediate action to help people with the cost of their energy bills and I will be making an announcement to this House on that tomorrow.
“And giving people certainty to make sure that they are able to get through this winter and be able to have the energy supply and be able to afford it.
“But we can’t just deal with today’s problem, we can’t just put a sticking plaster on it. What we need to do is increase our energy supplies long-term.
“And that is why we will open up more supply in the north sea, which (Keir Starmer) has opposed, that is why we will build more nuclear power stations which the Labour Party didn’t do when they were in office.
“And that is why we will get on with delivering the supply as well as helping people through the winter.”
Starmer insisted that families and public services “need every penny” that they are able to get.
“Add it all together and companies that are already doing well are getting a £17bn tax cut,” he said.
“While working people pay for the cost of living crisis, stroke victims wait an hour for an ambulance and criminals walk the streets with impunity.
“Families and public services need every penny they can get. How on earth does she think that now is the right time to protect Shell’s profits and give Amazon a tax break?”
The Prime Minister pledged that her government will keep corporation tax low.
“I’m on the side of people who work hard and do the right thing,” Truss told the Commons.
“That is why we will reverse the national insurance increase and that is why we will keep corporation tax low.
“Because ultimately, we want investment right across our country, we want new jobs and new opportunities and that is what I will deliver as Prime Minister.”
SNP Westminster leader Ian Blackford also raised the issue of who would foot the bill for an energy price freeze.
“I’m sorry to say that (Liz Truss’) reputation for straight-talking is falling apart at the first PMQs,” he said.
“After nine questions, she’s still not told us who will pay for her energy plan.
“Prime Minister, today the public are waiting to find out the response to the economic crisis and they want answers.
“So, will the Prime Minister finally answer two very simple questions – Will she freeze energy prices at their current level? And will it be paid for by a windfall tax? Yes or no?”
Truss responded: “No, it won’t be paid for by a windfall tax. I don’t believe we can tax our way to growth.”