Details emerge of ‘final’ Supreme Court landfill fluff ruling

Landfill operators place a layer of residual waste known as fluff at the bottom and sides of a cell to protect the liner.

In the dispute stretching back to 2008 and thought to be worth more than £300 million of landfill tax, Biffa, Veolia and Devon Waste Management claimed fluff was not liable because it served a use.

In January 2020, the companies were successful at the Upper Tribunal in appealing an earlier verdict which said the material was taxable (see letsrecycle.com story).

HMRC then appealed and, last April, the Court of Appeal ruled in its favour, finding the material was liable to tax (see letsrecycle.com story).

The waste management companies then went to the Supreme Court seeking the right to appeal.

Documents published on 12 May show the Supreme Court refused the companies’ appeal because “the applications do not raise an arguable point of law”. The case was heard by judges Lord Hodge, Lord Leggatt and Lord Sales.

An HMRC spokesperson told letsrecycle.com: “HMRC is pleased with the Supreme Court’s decision to uphold the Court of Appeal’s judgement, which now becomes final and binding.”

Letsrecycle.com has contacted Biffa for comment. Veolia declined to comment.

Tax

HMRC told letsrecycle.com that the amounts the waste management companies were looking to reclaim “constitute a large part of the tax that has been collected.”

The spokesperson added: “The Supreme Court’s decision ensures that the environmental purpose of the tax has not been undermined, ensures the tax continues to discourage the use of landfill and encourages more sustainable waste management options.”

Legislation was introduced in April 2018 to clarify what disposals at landfill sites were subject to tax, HMRC says, “with the aim of preventing future litigation” (see letsrecycle.com story).

Inquiry

Both HMRC and Biffa confirmed to letsrecycle.com that the case at the Supreme Court is separate to an ongoing inquiry Biffa referenced in a statement yesterday, 7 June (see letsrecycle.com story).

In disclosing it had been the subject of a takeover proposal, Biffa said it was currently the subject of an inquiry by HMRC regarding certain aspects of its landfill tax compliance.

On this separate inquiry, Biffa said that it “strongly refutes HMRC’s concerns” and says it is cooperating, but “based on evidence received to date” the potential liability could range from approximately £170,000 up to a possible maximum of £153 million.