Finance Act 1990

123 Gas levy. U.K.

(1) Gas levy shall not be payable by any person in respect of any gas unless—

(a) the gas is purchased by that person under a tax-exempt contract or under terms comprised in an excluded oil document; or

(b) the gas is won by that person, and not sold by him under such a contract or under terms so comprised, and is gas to which subsection (2) below applies.

(2) This subsection applies to gas which the British Gas Corporation was on 23rd August 1986 obliged or entitled to purchase (whether immediately or at some future date) under a tax-exempt contract or under terms comprised in an excluded oil document.

(3) In determining whether any gas which is won at any time is gas to which subsection (2) above applies, no account shall be taken of—

(a) any future variation of rights and liabilities under a tax-exempt contract, or under terms comprised in an excluded oil document, other than one effected by the exercise of an existing option; or

(b) any future termination of such rights and liabilities other than one occurring before 5th March 1990 [F1 or by effluxion of time, pursuant to a term in the contract or document, being a term in existence on 27th November 1991][F2 or pursuant to a term in a contract or document which is certified for trhe purposes of this paragraph by the Secretary of State with the approval of the Treasury].

[F3 (3A) The Secretary of State shall not certify a term for the purposes of paragraph (b) of subsection (3) above except on the application of the person winning the gas and unless the Secretary of State is satisfied—

(a) that the term (however expressed) provides for termination on the ground that the winning of gas in accordance with the contract or document has ceased to be commercially viable; and

(b) that the term was in the contract or document immediately before 16th March 1993; and

(c) that the termination purports to be in pursuance of the term; and

(d) that the term has been properly invoked.

(3B) For the purpose of determining whether a term is properly invoked the Secretary of State—

(a) may require the person winning the gas to supply him with any expert assessment provided under the contract or document;

(b) if no such assessment has been made, or if the Secretary of State considers it desirable for a further expert assessment to be obtained, may require the person winning the gas to obtain and supply him with an expert assessment;

and in this subsection “assessment” means an assessment as to whether winning gas in accordance with the contract or document has ceased to be commercially viable.]

(4) In this section—

• “excluded oil document” means a document which on 1st April 1980 was treated for the purposes of paragraph (a) of subsection (1) of section 10 of the Oil Taxation Act 1975 as containing the whole or part of a contract for the sale of excluded oil as defined in that subsection;

• “existing option” means an option granted before the commencement of this section;

• “future”, in relation to a variation or termination, means effected or occurring after that commencement;

• “tax-exempt contract” has the same meaning as the M1 Gas Levy Act 1981;

• “termination” means any termination, whether occurring by effluxion of time, by the exercise of an existing option or otherwise.

(5) This section shall be deemed to have come into force on 24th August 1986.

Textual Amendments

F1 Words in s. 123(3)(b) added (16.7.1992) by Finance (No. 2) Act 1992 (c. 48), s. 78.

F2 Words in s. 123(3)(b) inserted (27.07.1993) by 1993 c. 34, s. 209(1).

F3 S. 123(3A)(3B) inserted (27.07.1993) by 1993 c. 34, s. 209(2).

Marginal Citations

M1 1981 c. 3.