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BUDGET: Funding to tackle landfill tax evasion

Chancellor George Osborne has announced additional funding to tackle landfill tax evasion, among the measures in his latest Budget.

He also said that landfill tax rates will increase in line with RPI from April 2017 and 2018, revised reform of the Landfill Communities Fund and confirmed packaging recycling targets.

The standard rate of landfill tax is due to rise to £84.40 per tonne next month, and is expected to be £86.10 per tonne in 2017 and £88.95 per tonne in 2018.

Osborne pledged extra cash to increase “HMRC compliance activity to tackle tax evasion and non-compliance across the waste supply chain”.

Papers indicated that the annual increased revenue to the Treasury would be £5m in 2017-18, £10m in 2018-19, £20m in 2019-20 and £30m in 2020-21, a total of £65m.

Environmental Services Association (ESA) executive director Jacob Hayler said he was pleased that the Treasury had provided an additional £3.2m during the next five years to HMRC to tackle non-compliance and waste mis-description across the supply chain.

”The Government believes this will return £65m to the exchequer during the same period. This supports the findings of the 2014 ESA Education Trust report on waste crime, which showed that spending to fight waste crime yields an extremely high return.”

The Budget also says that HMRC will consult later this year on the definition of a taxable landfill disposal, with the intention of changing the definition in Finance Bill 2017.

The Prime Minister put us on the road to a largely carbon-free energy system by 2030, but the Chancellor hasn’t put enough fuel in the tank to get us there

Green Alliance director Matthew Spencer

It says the change aims to ”bring clarity and certainty to the tax without affecting its intended scope”.

A previously recommended reduction in statutory plastic packaging targets to 49% for 2016 has been confirmed, increasing by 2% each year to 2020.

The existing glass target of 77% will be maintained until 2017 and then increased by 1% each year to 2020.

Environmental Industries Commission executive director Matthew Farrow said that lobbying by his organisation and others had averted the abolition of mandatory carbon reporting, but added “there is little else for green entrepreneurs to cheer in the Budget”.

Green Alliance director Matthew Spencer said: “It’s fantastic that, this morning, the prime minister put us on the road to a largely carbon-free energy system by 2030, but the chancellor hasn’t put enough fuel in the tank to get us there.

“Funding less than 1GW a year of offshore wind in the 2020s, with nothing for mature renewables, will leave a big gap in power generation, however fast we pursue nuclear and gas. This is another example of the Government being strong on climate targets and weak on driving the necessary investment.”

Nick Blyth, Institute of Environmental Management & Assessment policy and engagement lead, expressed concern about “long-term effectiveness of the Government’s approach to the environment and sustainability”.

“In scrapping the carbon reduction commitment (CRC), the chancellor’s approach to replacing the revenue raised from CRC allowances in a ‘fiscally neutral way’ by simultaneously increasing the climate change levy could be a concern because such a tax may be difficult to make effective.”

Manufacturers’ association EEF’s senior energy policy adviser Richard Warren welcomed the scrapping of the CRC, “a vastly overcomplicated tax that has had a negligible effect on energy efficiency improvements in industry”.

He also praised the continuation of the climate change agreements for all sectors, “an essential element of the package of measures protecting our most energy-intensive industry from uncompetitive energy prices”.

ReFood commercial director Philip Simpson expressed disappointment to see rises to the climate change levy, which he said could “hit” renewable energy generators.

“To compound this, there have been further tax breaks offered to the oil and gas industry, demonstrating ongoing subsidy support to the fossil fuel sector.

“While £730m of funding for new renewable energy projects can be welcomed, it is really only a drop in the ocean. This is not enough to allow the sector to really achieve its potential.”

Suez technical development director Stuart Hayward-Higham suggested the Budget might include the UK’s first circular economy tax constraint.

The policy he referred to was the announcement that people with property or trading income below £1,000 will be allowed not to declare or pay tax on it from April 2017. This could apply to people renting out rooms on digital sharing websites such as Airbnb.

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