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Sepa cash cut in Edinburgh budget

  • Sepa budget cut from £39m this year to £36.6m
  • £133m - Scottish Landfill Tax revenue next year
  • Credit rate for the Landfill Communities Fund to stay at 5.6%

The Scottish Environment Protection Agency (Sepa) faces a cut of 6% in funding under the nation’s draft budget for the coming financial year.

The spending proposals have been set out by finance secretary John Swinney, who has also committed to ensure that Scotland’s new landfill tax shadows UK rates.

Details of individual spending budgets come in documents released by his department, which show a fall in cash for Sepa from £39m this year to £36.6m in 2016-17.

Sepa’s funding comes under Environment and Rural Services, which this year had a total budget of £180.9m. In 2016-17 that falls £180.3m – or £177.3m in real terms based on the current year.

The documents also indicate that Scotland’s own landfill tax, devolved within the UK since April, will generate a revenue of £133m next year but is expected to fall to £94m during the next five years.

For the first two quarters of the current financial year, Revenue Scotland collected £74.6m in landfill tax. It says that, based on these figures, revenues for the full year are likely to exceed the original forecast.

”This is principally due to the lack of Scottish data which was available on the predecessor UK tax and updates to waste volume data used to produce the original forecasts,” it said.

It adds that it expects tax rates in Scotland to continue to mirror those in the rest of the UK to avoid ‘waste tourism’, a possible financial incentive to dispose of landfill in neighbouring countries with different landfill tax regimes and rates. 

Swinney told the Scottish Parliament he would increase the lower rate of tax to £2.65 per tonne and the standard rate of tax to £84.40 per tonne with effect from 1 April 2016.

But Scotland is not following chancellor George Osborne’s lead on the credit rate for the Landfill Communities Fund.

Swinney said: ”Last year, I announced my intention to set the credit rate for the Scottish landfill communities fund 10% higher than the UK equivalent for the first three years. However, the UK Government recently announced plans to drop its equivalent credit rate to 4.2%.

”I believe that that is the wrong decision for our environment. Therefore, we will maintain the existing credit rate of 5.6%, ensuring that landfill site operators contribute more to community and environmental projects than is the case elsewhere in the United Kingdom.

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