Why windfall taxes come at a great cost

There is no such thing as free money. This was learned the hard way last month, when investors made clear after Liz Truss’s mini-Budget that the era of cheap money was over. Mass borrowing for day-to-day spending was going to have a big premium attached: a bill so large that no government would want to pay. Rishi Sunak understood this delicate dynamic, and said so many times over the summer. His willingness to admit the truth – that the government’s many promises can’t be delivered for free – is what, eventually, landed him in No. 10.

But now in power, Sunak and his chancellor Jeremy Hunt risk making another ‘easy money’ assumption, albeit a very different one. The massive profits of the energy companies have, once again, caught Sunak’s eye. It’s not hard to see why. The headline figures are rather staggering. Shell doubled its profits from the year before between July and September, reaching £8.2