Local representatives have responded to chancellor Rishi Sunak’s hint of a U-turn on the decision not to impose a windfall tax on energy firms. 

In a recent interview with Mumsnet, Sunak suggested the option could be considered having previously refused due to a desire to not put off new investment in the sector - despite repeated calls to do so from Labour and Liberal Democrats. 

The chancellor said: “If we don’t see that type of investment coming forward […] then of course that’s something I would look at.”

A windfall tax is a tax on what is described as "the excess profits of the privatised utilities."

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MP for Wokingham, John Redwood, agreed with deputy prime minister, Dominic Raab, who called the idea “disastrous.” 

Redwood said: “The chancellor is wrong to threaten another windfall tax on energy. The U.K. already charges double corporation tax. Labour's windfall tax idea will deter investment and leave us short of domestic energy.” 

Labour, alongside the Liberal Democrats, have been calling for the government to impose the windfall tax on North Sea oil and gas producers to fund measures to help ease the rising cost-of-living. 

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Campaign Coordinator for Wokingham Labour Group, Andy Croy, said: "The point of a windfall tax is that it is on unexpected profits. No one plans investment on the basis of unexpected profits as they are, by their nature, unexpected. 

"Labour is also demanding an Emergency Budget. This will allow Sunak to set out a full range of measures to help people cope with the cost-of-living crisis." 

In February, BP said it has “more cash than we know what to do with” as it posted profits of around £10b. 

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Parliamentary candidate for Wokingham Liberal Democrats, Clive Jones, said: “I don’t think they’ve got any intention of putting a windfall tax on energy companies, but they should be. 

“The government is saying we can’t take that money off them because they are going to invest it over the next few years. No, take it off them and use that money to soften the blow of energy bills.” 

In the same interview, Sunak said it would be "silly" to provide more support to tackle rising costs now, without knowing what is likely to happen in the autumn. 

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Jones responded: “I think the chancellor is actually being quite silly himself. He knows there is now a big cost-of living crisis.  

“Inflation is over 7 per cent and is hurtling towards double figures. The cost of food is up 20 per cent, household goods, the cost of raw materials for construction, everything.” 

Redwood also agreed that the treasury needs provide more immediate support to help those struggling with rising costs. 

“We need to provide the help now,” he said. “The treble hit from inflation, interest rate rises and tax rises will do too much damage to the economy.”