Paul Levett, director at Waste Transition Ltd and former deputy chief executive officer at Veolia, said there were specific issues that must be addressed in his response to the HMRCs consultation on trommel fines, which is due to end next month (see letsrecycle.com story).
‘The LOI testing protocol should seek to be representative of the load as a whole. If sample sizes are too small, the results may not be representative even if samples are extracted from multiple parts of the load.’
– Paul Levett, director of Waste Transition Ltd
Under the rules proposed by HMRC, landfill operators will have to perform loss on ignition tests for every thousand tonnes of waste received from an individual plant from April 2015, in order to clarify whether trommel fines material attracts the standard or lower rate of tax, which stand at 80 per tonne and 2.50 per tonne respectively.
The LOI test determines the presence of non-inert material in a waste load, which is weighed and cooled and weighed again to establish how much mass has been lost (see letsrecycle.com story). Any load containing trommel fines must have an LOI of 10% or less in order to meet the lower tax bracket.
Composite
In its consultation, HMRC has stated that customers must produce a master composite sample made up of six or more sub-samples taken from different areas of the waste load.
But in his response to HMRC, Mr Levett highlighted that while the proposals were generally reasonable, time limits and changes to sample sizes would be required in order to avoid bias.
He stated: The waste materials which are input to MRFs have multiple compositions and therefore a load of fines, say 20 tonnes, will not be homogenous.
The LOI testing protocol should seek to be representative of the load as a whole. If sample sizes are too small, the results may not be representative even if samples are extracted from multiple parts of the load.
Time
And, while HMRC has already estimated the tests will take one to two weeks to complete, the body has not provided a minimum time period in which customers can expect to receive their results.
Mr Levett added: If test results indicate that several loads should attract standard rather than lower rate tax, the impact on profitability and cash flow could be considerable as it’s unlikely that the MRF operator could seek compensation from the waste producer.
Landfill operators should be required to notify test results and apply any addition tax within, say, 14 days of the fines being deposited.
Mr Levett, who is also currently working with Powerday as an independent member of the firms advisory board, has previously warned that a delay in returning LOI test results to operators would render the procedure impractical (see letsrecycle.com story).
His latest comments echo concerns raised at a meeting between HMRC representatives and the skip hire industry in Manchester last month, where critics of the process argued LOI testing is too inconsistent to provide a measure of trommel fines (see letsrecycle.com story).
However, Mr Levett added that he did not believe the costs of the test would fall disproportionately based on the size of transfer station operators, as non-compliant operators can be found at both large and small waste companies.
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