The Merseyside-based firm object to the levy on the fuel, which is currently free of tax, as the company believes it could potentially remove the incentive for companies to use recycled waste oil.
Adding this tax will increase the cost by approximately 30% and bring prices more in line with virgin fuels. The incentive for industry to use recycled fuel will be lost.
Andy McNair, managing director, OSS
The taxation, which OSS claim has gained some support among MPs, would tax waste derived fuel oil at 9.29 pence per litre and put it at the same level as virgin heavy fuel oil.
Managing director of OSS, Andy McNair, said: “This could kill not only the market for recycled fuel oil but also remove the incentive for companies such as us to invest in leading recycling technology.
“Government wants to encourage recycling. This will have the opposite effect. At present there is a reasonable difference between the cost of virgin fuel and waste derived fuel. Adding this tax will increase the cost by approximately 30% and bring prices more in line with virgin fuels. The incentive for industry to use recycled fuel will be lost” he added.
Clean Fuel Oil
OSS uses waste lubricating oil collected from UK garage and servicing centres to produce a processed fuel oil equivalent to virgin fuel oil known as Clean Fuel Oil (CFO), which the company claims is the best environmentally sustainable way to deal with some of the 800,000 tonnes of waste oil produced a year in the UK.
Over the last year, the Environment Agency and Defra have been formulating a Quality Protocol for fuel derived from waste lubricating oil, which was put out for consultation at the end of last month. (see letsrecycle.com story)
The Merseyside company previously clashed with the Environment Agency in a two-year court battle over the definition of ‘waste' and, in June 2007, won the right to continue to produce CFO having proven that CFO was indistinguishable as a product from virgin fuel oil. (see letsrecycle.com story)
The waste oil recycling company is now lobbying both Defra and the Treasury and has received support from MPs Dr Richard Taylor (Independent), George Howarth (Labour) and Collin Challon (Labour).
Dr Richard Taylor said: “OSS has developed technologies and processes to address a major environmental problem facing the United Kingdom, namely the removal of hazardous waste oil from the waste stream. I am deeply concerned that the Government's planned duty risks undermining that achievement.”
A spokesman for Her Majesty's Revenues and Customs confirmed whether the Government does intend to introduce this tax.
“The answer is yes, it is coming in on 1 November, and 9.29p will be added to every litre of Clean Fuel Oil,” he said.
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