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Are we only a month away from an incineration tax?

We now know that the Chancellor’s next budget statement is due to take place on Monday 29th October 2018. We also know that serious consideration is being given to the inclusion of a tax on waste incineration as part of the forthcoming budget. An incineration tax might be only a month away!

UKWIN’s call for an incineration tax has been reflected by others, with the Government noting in August that: “Respondents from across the supply chain have suggested a tax on the incineration of waste”.

On 19th May 2018 an article entitled ‘Incineration tax could boost plastic recycling’ appeared in The Times. This article reported that: “A new tax on waste incineration is being considered by the government to help increase recycling of plastic and reduce the amount that ends up in the ocean”. The Times article quotes Robert Jenrick MP, the exchequer secretary, as stating that: “There is an argument for changing the incentives to discourage putting further waste to incineration. We [at the Treasury] would like to see less plastic incinerated, sent to landfill or exported and more recycled”.

On the 18th of August 2018 the Treasury announced that an incineration tax was one of four policies being considered for announcement as part of the 2018 Budget Statement as a measure to help tackle the plastics problem, and in late September it was confirmed that the Government will publish its next Budget on Monday 29 October 2018.

As noted in the briefing available from an incineration tax could:

  • Compensate for the loss of Landfill Tax revenue;
  • Support recycling and the management of waste in accordance with the Waste Hierarchy; and
  • Ensure that the price of incineration reflects the cost to society of CO2 and other harmful emissions from waste incinerators.

On the 26th of September 2018 it was reported that: “The idea of an incineration tax, which is currently being assessed by Treasury officials, is seen as its action in response to the record number of public responses to its ‘tackling the plastic problem’ consultation. The incineration tax is being seen as an alternative to a tax on single use plastics as it would be easier to implement”.

UKWIN’s view is that an incineration tax paid for by those who incinerate waste is entirely compatible with (and indeed complementary to) measures to ensure that, where those costs are due to producers making products that are difficult or impossible to recycle, there is cost recovery as part of an Extended Producer Responsibility scheme.

UKWIN has not been alone in having called for an incineration tax. Those who have highlighted its benefits include:

  • John Grogan MP (Labour) – “There is a tax on landfill so why not on incineration? All the evidence suggests that England now has an excess of incineration capacity.”
  • David Drew (Labour Shadow Resource Minister) – “…There are many arguments in favour of taxing existing incinerators. It is right for polluters to be expected to pay for the pollution they cause.”
  • The Green Party – “Lobby the government for a tax/charge on incineration, so that recycling infrastructure has a chance to compete and grow.”
  • Policy Exchange – “By introducing taxation on incineration a clear preference is signalled to reduce, reuse, recycle or compost where possible”
  • DS Smith Recycling – “An over-reliance on EfW will lead to lost recycling opportunities….An incineration tax could be introduced and escalated as a means of encouraging incineration diversion, and more widespread reduction and reuse…”

Those who support an incineration tax are being asked to write to their MP in support of this measure. UKWIN has provided a helpful template letter for supporters of an incineration tax to adapt which is available at:

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