9 October 2014 by Tom Goulding

Scotland to keep UK Landfill Tax rates

Scotland is set to retain similar Landfill Tax rates to those set by Chancellor George Osborne when further powers are devolved to the Scottish Parliament in April 2015.

The revelation came as Scottish Finance Secretary John Swinney set out Scotland’s annual draft budget for 2015/16 today (October 9) – the first to contain taxation powers in more than 300 years.

Scotland is to maintain UK levels of Landfill Tax from next year

Scotland is to maintain UK levels of Landfill Tax from next year

Mr Swinney announced that the standard and lower rates of Landfill Tax will remain level with the rest of the UK at £82.60 and £2.60 per tonne respectively when the powers are transferred to the Scottish Parliament under the Scotland Act 2012 on April 1 2015.

Landfill Tax joins the Land and Buildings Transaction Tax (LBTT) – a replacement for the existing UK stamp duty land tax paid when purchasing a property over a certain value – as one of two tax powers that will be devolved from next year.

£600 million

The tax, which is expected to generate up to £600 million per year for Scotland, will be managed and collected by newly-created body Revenue Scotland. A block grant from the UK Treasury has been adjusted to reflect the transfer of tax receipts to Holyrood.

Mr Swinney did not comment on a third rate of tax proposed under the new powers, which would see certain types of bio-stabilising material reclassified to fetch a lower charge.

And, it is also yet to be announced how the Scottish Landfill tax will be extended to illegal dumping, an area which is not currently covered by the UK.

Under current UK legislation, enforcement action is usually taken against waste operators caught dumping waste illegally – but they are not liable to pay Landfill Tax. New powers in Scotland could see the same operators liable to pay the Tax they have avoided.


Stephen Freeland, policy executive at the Scottish Environmental Services Association (SESA), welcomed the decision to keep rates level with the rest of the UK, which he argued would reduce the risk of operators shopping for cheaper disposal options across the border.

He said: “The landfill tax has proved one of the principal policy drivers for effecting change in the waste and resource management sector. By increasing the costs of landfill in a uniform and predictable way, the landfill tax has made alternative treatment infrastructure more economically viable, thereby encouraging the industry to invest in a range of facilities designed to recycle and recover the value embedded in waste.”

He added: “Since proposals for a devolved landfill tax were first announced, SESA has pressed for the Scottish landfill tax rate to mirror that of the rest of the UK. Without this consistency across the home nations price disparity might otherwise be exploited, leading to “waste tourism”, where waste is transported to or from Scotland to take advantage of the cheapest waste disposal option.

“We are therefore pleased that the Scottish Government has listened to the industry’s views.”


It remains unclear whether Scotland will seek to adopt loss on ignition testing for trommel fines, in order to determine whether some waste loads should attract a standard or lower rate of tax.

Plans to introduce the testing regime in England from April 2015 were put to consultation in June, with the findings expected to be published in December 2014.


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