Landfill Tax rates increased across the UK from 1 April 2018 and the tax was extended to include disposals at unauthorised waste sites in England and Northern Ireland.
Another significant change from 1 April 2018 is that the Welsh Government now has its own powers to set the Landfill Tax for Wales which is known as the Landfill Disposals Tax (LDT) and which has been confirmed at the same level as the rest of the UK this year.
Scotland continues to have its own landfill tax, and again this is set at same rate as the rest of the UK, and is known as the Scottish Landfill Tax (SLfT). Scotland already levies the tax on unauthorised disposal sites and Wales has provision to do this also.
Landfill gas pipes being installed on a landfill site in England
The tax rates – all UK areas currently have the same rate – were indicated some time ago and from 1 April 2018 they are: for standard rate material £88.95 and lower rate (‘inert’) material (qualifying fines with a loss of ignition of 10% or lower) at £2.80 per tonne.
From 1 April 2018, Landfill Tax is changing to include disposals at unauthorised waste sites in England and Northern Ireland. These changes aim to support legitimate waste management businesses by creating a fairer tax system and be a deterrent to causing environmental harm by disposing of material at an unauthorised waste site.
In England and Northern Ireland, the illegal disposal tax charge will be the tax level avoided plus up to an additional penalty of 100% of the tax avoided. In Scotland the “unauthorised” rate will be 150% of the usual tax rate.
One additional feature of the illegal disposal charges which can be levied by HMRC in England and Northern Ireland, is that if someone owns up to illegal dumping or running an illegal site by 1 May 2018, and the waste was deposited before 1 April 2018, then they will not be subject to a penalty but will still have to pay the tax. This arrangement does not apply to any waste dumped at an illegal site after 1 April 2018 which will still be subject to Landfill Tax and a penalty. Those involved in illegal disposal under this month long rule would remain likely to be subject to other environmental measures from the Environment Agency, Northern Ireland Environment Agency, the police or another enforcement authority.
The tax on illegal disposes forms part of measures which are seeing a government policy on cracking down on illegal dumping and illegal disposal sites, continuing to be implemented.
The head of HMRC said over the Easter weekend that the greater powers will hit criminals in their pockets.
HMRC explained that with no Landfill Tax to pay, “rogue operators were able to undercut legitimate operators and make significant profits, at the expense of both the legitimate trade and the environment”.
David Richardson, Director General, HMRC said: “For too long fraudsters have dodged paying tax and dumped waste in illegal sites. These greater powers announced today will hit criminals where it hurts the most – their pockets – and help keep our countryside clean.”
Sir James Bevan, Chief Executive of the Environment Agency, said: “The message is clear: waste crime does not pay. Those who seek to damage the environment and blight communities by dumping waste irresponsibly will be made to foot the bill for their crimes.”
The Landfill Tax came into force in 1996
And, HMRC noted that also from 1 April, the Department for Environment, Food and Rural Affairs had also announced that councils will now have the power to almost double maximum on-the-spot fines for littering and graffiti from £80 to £150, showing that whether people are littering on a small or a large scale the penalties are high.
Landfill Tax, said HMRC, was introduced on 1 October 1996 as a disincentive to landfilling material and to encourage the switch to more environmentally friendly alternatives. Since the introduction of the tax in the UK, landfilling is down more than 60%.
HMRC Advice to non-waste businesses
HMRC has advised businesses that those who “manage their waste in compliance with environmental regulations, and exercise all reasonable due diligence”, will not be liable for any Landfill Tax on disposals made at unauthorised waste sites. HMRC expect businesses in England to check their waste contracts to ensure they are complying with the Defra Waste Duty of Care Code of Practice, and businesses in Northern Ireland to check their contracts comply with the DAERA Waste Duty of Care Code of Practice.
If you think someone is evading tax, report it via the Tax Evasion Hotline on 0800 788 887 or online.
HMRC Advice to waste and other businesses and councils
Legitimate waste companies, local authorities and businesses also have a responsibility to check what happens to their waste. They must make sure that they know what their legal responsibilities are by reading our updated guidance on GOV.UK
To report someone believed to be evading Landfill Tax, this can, said HMRC, be reported via the Tax Evasion Hotline on 0800 788 887 or online.