A backbench Conservative MP has said he feels “disappointed, embarrassed and appalled” at the government’s decision to impose a temporary windfall tax on energy firms.

Craig Mackinlay, who chairs the Net Zero Scrutiny Group, told the Telegraph newspaper today that: “Whichever way you look at it, a 65 per cent tax rate applied to an industry that we need to encourage to help us through our energy policy mess seems topsy-turvy.

“Higher taxes can never mean lower prices. All in all, I’m disappointed, embarrassed and appalled that a Conservative Chancellor could come up with this tripe.”

The chancellor previously announced a £200 energy bill discount, after which consumers would pay back the money over five years.

New plans will be partly funded by a temporary, targeted Energy Profits Levy charged on profits of oil and gas companies at a rate of 25 per cent and the loan element will be scrapped.

All houses will receive a one-off £400 payment.

People claiming benefits can receive £650.

£300 extra will be given to pensioners, with another £150 set aside for each person on non means tested disability benefits.

These payments will be sent to households in two lump sums in July and in the autumn.

This will cost around £5 billion, which Sunak told MPs the new windfall tax will account for.

The Liberal Democrats also slammed the plans as inadequate, highlighting how taxes will rise by £22.4 billion.

OBR forecasts that personal tax will rise by £13.8 billion this year – through the National Insurance rise and the freezing of Income Tax thresholds.

The government will also collect £8.6 billion in extra VAT due to inflation.