The UK Chancellor of the Exchequer Philip Hammond has announced plans to review the taxation of North Sea assets.

In his first budget to the House of Commons, Hammond announced he would set-up an expert panel to examine how tax can assist sales of oil and gas fields and extend productive life.

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A discussion paper on how to help the industry will also be published, reported BBC.

These measures are expected to help the North Sea assets, which meet nearly 50% of UK energy requirements.

Various industry leaders and politicians have been urging the government to extend support to the oil and gas industry through a revised tax system, as well as by ensuring that ageing assets in North Sea are in the 'right hands' to attract further investments.

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The government has already provided support to the oil and gas sector through £2.3bn package in the last three years.

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"This is an area where we have repeatedly called for reform and which the UK Government has been slow to react."

According to Hammond, the support to the North Sea operators is intended at 'building the foundations for a stronger, fairer, more global Britain'.

Previously, firms could claim relief on taxes against the decommissioning cost of old fields if they have a tax history in the UK. This made new entrants cautious of acquiring older assets as they had concerns of being saddled with decommissioning costs.

Commenting on Hammond's announcement, the Scottish Government's finance secretary Derek Mackay was quoted by BBC as saying that it was 'encouraging that the UK Government has finally listened to the Scottish Government about the failings of the decommissioning tax regime'.

He added: "This is an area where we have repeatedly called for reform and which the UK Government have been slow to react, therefore it is important that this group comes to a swift conclusion and is not simply another talking shop."