And, some have described the decision to tax operators for waste used on roads, cappings and liners at landfill sites, which was announced by Her Majestys Revenue & Customs (HMRC) on Thursday (January 23) as unfair.
Under the controversial ruling HMRC said it will vigorously defend claims for refunds on the waste, also known as fluff, when companies consider it not taxable.
But many large and small landfill operators have reacted angrily to the news, with action against HMRC already underway in a First Tier Tax Tribunal, part of a formal procedure to challenge HMRC decisions (see letsrecycle.com story).
Alan Potter, director of consultancy Beyond Waste said removing fluff from exemption would be counter-productive and risked throwing the baby out with the bathwater.
He said: Fluff is only one material that is put to use in landfills – other materials being hardcore for road making, soils for restoration and inactive materials for daily cover and liner preparation.
Clearly such materials are essential to sustain the day to day operation of and ultimate completion of landfills in an environmentally responsible manner. To remove exemption from the use of waste materials for these purpose would be counter-productive.
‘Distorting’
Robert Hunt, chief administration officer at Veolia Environmental Services which operates 13 active landfill sites across the UK – also commented on the distorting influence of the revision, and said the company would consult with its legal advisers over what steps it would take next.
‘HMRC’s refusal to pay any further landfill tax refunds on waste placed as engineering fluff layer significantly distorts competition with the result that taxpayers are not treated equally and fairly. We are consulting with our legal advisers to take the appropriate steps to protect our position.’ – Robert Hunt, Veolia Environmental Services chief administration officer
He said: “HMRC’s refusal to pay any further landfill tax refunds on waste placed as engineering fluff layer significantly distorts competition with the result that taxpayers are not treated equally and fairly. We are consulting with our legal advisers to take the appropriate steps to protect our position.”
Following the announcement, a spokesperson for the Environmental Services Association said: The industry is disappointed at HMRCs decision not to repay outstanding landfill tax claims for fluff material. This has now created an uneven playing field between those landfill operators which have been paid and those which have not.
ESA is keeping a close eye on developments and will advise Members affected in any way possible.
The HMRC has emphasised that in its view there is no evidence to suggest that fluff layers fulfill any engineering purpose or a regulatory requirement. More details about the announcement and policy decision can be found in guidance brief just published by HMRC: Landfill Tax Brief 02 14
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