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North Sea Oil And Gas (Licences)

Volume 978: debated on Tuesday 12 February 1980

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asked the Chancellor of the Exchequer whether he will seek to mitigate the effect of capital gains tax on farm-ins and thus permit third parties without penalty to acquire an interest in North Sea licences following the drilling of oil or gas wells.

Any liability in respect of a capital gain from such a transaction would fall on the person disposing of the interest, not the person acquiring it. It follows that there is no capital gains penalty on a person who acquires an interest in a North Sea licence.