The UK’s tax expenditure on fossil fuels stood at $19.78 billion in 2024, forecasted to grow steadily to $21.95 billion by 2028. This represents an increase of 2.78% annually on average. The year-on-year growth is projected at 2.78% for each subsequent year. In 2023, this expenditure was lower, marking a clear upward trend post-2024.

Future trends to watch include:

Government initiatives on renewable energy subsidies could alter fossil fuel tax expenditures.
Policy shifts targeting carbon reduction might accelerate changes in tax expenditure.
The fossil fuel industry’s response to global energy transition may influence future tax spending.