OPINION: In November 2021, HM Treasury launched a call for evidence seeking views on certain aspects of its Landfill Tax, including the rate that applies to different materials and the circumstances in which exemptions and discounts can be claimed.
The aim of this was to ensure Landfill Tax would continue to support the Government’s environmental objectives, including achieving zero avoidable waste by 2050.
After closing in February 2022, the Treasury shared the outcome of the consultation, over a year later, in March 2023. Following analysis of the responses it concluded “that there is scope for much of the material currently eligible for the lower rate of landfill tax to move up the waste hierarchy and that the current rate of tax charged on this material does not provide sufficient incentive in many cases.”
In other words, the Treasury intends to increase the lower rate of tax for material eligible for landfill because it sees this as a way to incentivise waste producers to move material up the waste hierarchy rather than dispose of it.
It is widely acknowledged that whilst plans to increase the lower rate of tax would incentivise waste producers to move things like incinerator bottom ash and air pollution control residues from energy from waste plants further up the waste hierarchy, the same cannot be said of materials such as clay and subsoils, otherwise known as inactive soils.
The Landfill Tax is there as an economic measure to drive waste streams up the waste hierarchy to avoid the environmental consequences of landfill emissions. There are no emissions with an inert landfill site. If done correctly in accordance with the permit, then the site can be brought back to beneficial use.
In the construction sector, the development of a site often requires the removal of inactive soils to allow for the new development. It is unlikely the developer will find a use for this material within the confines of the construction site, meaning it must be removed.
Soils
By failing to take the uses of inactive soils into account, the Government has overlooked something which may support its environmental objectives: the regeneration and redevelopment of brownfield sites and the filling of former landfills, giving them a new lease of life or improving biodiverse landscapes – positively contributing through economic, social and ecological value.
The rise in cost caused by increasing the lower rate of Landfill Tax has the potential to function as a deterrent to regenerating brownfield sites and result in the loss of significant development value as developers will not want to pay extra to dispose of the soils. With housebuilding levels expected to fall to their lowest level in decades, the Government should be looking at the unintended consequences of policies such as this can have.
Additionally, if the proposed Landfill Tax rate is introduced, the Government would be naïve to think that less scrupulous operators will not still take advantage of and manipulate the system to avoid paying tax and make money illegally. This increase will allow other hazardous soils to be mislabelled as clean soils when imported and waste crime will continue.
We have seen first-hand the ecological benefits landfill restoration can bring. One of our former landfill sites, Penny Hill, has been transformed into a home to more than 400 different butterfly and moth species. Located on the outskirts of Worcester, Penny Hill landfill closed in the late 1990s and restoration works began shortly after. By 2011, the site was recognised as a significant habitat for butterflies and moths, when a member of West Midlands Butterfly Conservation spotted a Dingy Skipper, a rare species of butterfly distinguished by its mottled brown wings and rather furry appearance.
Biodiversity restoration is not the only use former landfills can have. As previously mentioned, the regeneration and redevelopment of landfills and the areas around them can also help to overcome the current housing supply crisis by providing land for new housing.
Raising the lower rate of Landfill Tax may inadvertently discourage investments
Consulting
We’re currently in the process of consulting on new plans for unused land at our Judkins Quarry site. These new plans provide provisions for up to 400 new homes – including affordable ones – alongside the creation of meaningful and useable green spaces along the Coventry Canal and new children’s play areas.
As it stands, if the lower rate is increased, we’ll be unable to complete certain quarry backfill sites and will not bring them forward for regeneration due to viability issues.
Recovery of land using inactive materials for beneficial use is recognised in the EU whereas in the UK it appears that Landfill restoration is becoming increasingly demonised despite some of the good that inactive disposal can do, with no risk to the environment.
Raising the lower rate of Landfill Tax may inadvertently discourage investments in recycling and resource recovery infrastructure. By taking a more tailored approach to the materials – by exempting materials that may have no other use – the lower tax rate would apply to, the Government could incentivise waste management companies like FCC Environment to continue investing in innovative technologies and methods that promote recycling, divert waste from landfills and regenerate brownfield sites. Such initiatives not only benefit the environment but also foster the growth of a circular economy.
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