Landfill Tax Rates Reach New Heights

Wednesday, April 8, 2015

On the 1st April 2015 Landfill Tax rates across the UK once again increased, in continued efforts by the Government to incentivise waste reduction and its diversion from disposal to landfill.

This is the eighth consecutive year that Landfill Tax has increased, although the first year since 2011 where the increases have not been predetermined by the escalator standard previously set by the UK Government.

This latest increases will see the rate of Landfill Tax rise from £80 per tonne to £82.60 per tonne until April 2016.  This rate is applicable to all active waste which is disposed to landfill.  The lower rate, for inert waste, has also increased from £2.50 per tonne to £2.60 per tonne.  

The 1st April 2015 also marks the first day that operators of landfill sites in Scotland will no longer be liable to pay UK Landfill Tax for waste disposed of at their Scottish sites.  Instead, they will be liable to register and account for Scottish Landfill Tax, one of the first independent tax powers for Scotland in over 300 years.

Landfill tax was first introduced in 1996.  It aimed to encourage efforts to minimise the amount of waste being produced within the UK and to increase the use of non-landfill waste management and treatment options, such as reuse, recycling, composting and waste recovery.  Its introduction became a key driver for many to reduce their reliance on landfill and to explore other, more sustainable and resource efficient waste management options.

Between April 2011 and April 2014 Landfill Tax increased each year by a fixed rate of £8 per tonne, which saw rates rise from £56 per tonne to £80 per tonne in four years.  However, in March 2014 the UK Government announced its plans to scrap this escalator standard and instead link future increases to UK inflation rates.  From April 2015 future Landfill tax rates will be calculated according to the Retail Price Index (RPI) and rounded to the nearest five pence.

At the end of last month Her Majesty’s Revenue and Customs (HMRC) also announced the projected Landfill Tax rates for 2016/2017 which will see further increases, from £82.60 to £84.40 per tonne for all active waste and from £2.60 to £2.65 per tonne as the lower rate for inert waste. 

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