Provisions including a water discount for landfill operators and loss on ignition (LOI) testing will be included in the new landfill tax regime, which will come into effect when further powers are devolved to the Scottish Parliament in the spring.
The latest amendments, which were signed off by Scottish Finance Secretary John Swinney in December 2014, were subject to a public consultation in the summer and negotiations between the Landfill Tax Bill Stakeholder Group.
The Scottish Government convened Stakeholder Group included members from the Chartered Institution of Wastes Management (CIWM), the Scottish Environmental Services Association (SESA), FCC, SITA UK and the William Tracey Group.
Under the current UK system, landfill operators can apply for a 25% discount on the water content of waste in certain circumstances, such as when waster has been used to damp down waste to reduce dust.
The consultation proposed excluding the discount from the Scottish Landfill Tax, as adding water to waste could have a ‘negative environmental effect’ through increased leachate.
The Government also argued the discount would be difficult to enforce and open to abuse from landfill operators, who could falsely claim water had been added to the waste.
Disadvantage
However, the Stakeholder Group argued the cost of de-watering waste would put Scottish business at a competitive disadvantage compared to other UK companies – and even encourage the flow of waste from Scotland to landfill sites in the north of England.
The Government has now decided to include the discount, but may ‘observe how the discount works in practice and consider amending regulations’ following further engagement with industry.
Scotland will also adopt the Qualifying Materials Order from April 2015, which provides clarity on which waste materials can qualify for the lower rate of tax – currently placed at £2.50 per tonne.
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Scotland will be introducing LOI testing for waste operators in order to clarify whether a waste load should be subject to the standard or lower rate of tax. The regime is also due to be introduced in the rest of the UK in April 2015 (see letsrecycle.com story).
And, bodies distributing money under the Landfill Communities Fund will also need to register with the Scottish Environment Protection Agency (SEPA). This is expected to save the regulator time on auditing individual projects.
Commenting on the amendments, SESA policy advisor Stephen Freeland said: SESA’s Policy Advisor, Stephen Freeland said: “SESA is pleased that the regulations confirm that Scottish landfill operators, and their customers, will continue to benefit from the water discount.
“SESA had argued that the removal of the water discount (as previously proposed) would place Scottish businesses at a competitive disadvantage to their UK counterparts, and would simply encourage the transport of material over longer distances to disposal markets elsewhere in the UK.”
Powers
The changes are secondary statutory instruments to the Landfill Tax (Scotland) Act 2014 which will see landfill tax powers devolved to the Scottish Parliament this year.
The transfer of the tax will see newly-created body Revenue Scotland manage and collect an estimated £600 million per year – and is one of Scotland’s first independent taxation powers in more than 300 years.
It follows Mr Swinney’s announcement in the annual draft budget that the standard and lower rates of Landfill Tax will remain level with the rest of the UK – which in April will stand at £82.60 and £2.60 per tonne respectively (see letsrecycle.com story).
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