The Welsh Government has published landfill disposal tax rates for the next two years with an assurance that they will be similar to landfill tax rates in England to avoid waste tourism.
And, the Welsh Government also said that illegal disposal of waste would attract a penalty landfill disposal tax rate of 150% and that it is to consider a “disposable plastic tax”.
Landfill disposal tax in Wales will be set at the England level for 2018-19 and the following year
The landfill disposal tax (LDT) will replace landfill tax in Wales from April 2018.
The tax rates, along with others for housing and business property purchases, were hailed by Finance Secretary Mark Drakeford as “Wales’ first taxes in almost 800 years.”
Wales-England border
For the first two years of the landfill disposal tax (LDT), explained the Welsh Government, the standard and lower rates “will remain consistent with those for landfill tax. This will provide certainty and stability for businesses and reduce the risk of waste moving across the Wales-England border. The new unauthorised disposals rate will be set at 150% of the standard rate.”
The Welsh Government pointed out that the majority of landfill sites in Wales are within 25 miles of the Wales-England border and there are more landfill sites within 25 miles of the border on the English side. And, it reported that analysis of haulage rates suggests “that a relatively small differential of less than £10 in rates between Wales and England could introduce a significant financial incentive to move waste across borders.”
With regard to the 150% charge on unauthorised disposals, a report for the Welsh Government, explained: “It intends to ensure unauthorised disposals are more financially risky and so a less attractive option for those tempted to ignore their environmental obligations and evade tax. It therefore seeks to realign the balance of risk, so that the consequences of making unauthorised disposals outweigh the perceived benefit of evading tax.”
Fairness
Announcing the rates and bands, Professor Drakeford said: “The devolution of tax powers provides us with the opportunity to reshape and make changes to improve existing taxes to better meet Wales’ needs and priorities. I have always been clear that we will use these powers to help improve fairness and support jobs and economic growth in Wales.
Professor Mark Drakeford, Wales’ finance secretary, who has promised the Welsh version of the landfill tax will be at a similar rate to England for at least two years
“These new progressive rates and bands for land transaction tax and landfill disposals tax will make a real difference to people’s lives; help change behaviours and deliver improvements to communities across Wales. We are being bold but balanced and leading the way in creating a fair and progressive tax system.”
Under the Wales Act 2014, the Welsh Government has powers to put forward proposals for the development of new taxes in areas of devolved responsibility.
Disposable plastic tax
Professor Drakeford announced a shortlist of four new tax ideas – based on feedback from the public – which will be developed further this autumn. One proposal will be put to the UK Government in 2018 to test the Wales Act powers.
The four new ideas which will be explored further are:
- A vacant land tax;
- A disposable plastic tax;
- A tourism tax
- A levy to support social care.
Professor Drakeford added: “In July, I started a national debate asking people to put forward ideas for potential new Welsh taxes. We received a large number of responses and I’d like to thank everyone who got involved and helped shape future Welsh taxes.
“The power to propose new taxes is an important one, which we can use to deliver improvements for our communities. The four new tax ideas have the potential to do just that.
“Over the coming months, further work will get underway to refine these before we propose one idea to the UK Government early next year.”
Welsh Tax Policy Report
The rates and bands for land transaction tax and landfill disposals tax are set out in the Welsh Tax Policy report, which is published today alongside the draft Budget 2018-19. It is available at: Welsh Tax Policy Report
The Finance Secretary gave a commitment during the passage of the Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act and the Landfill Disposals Tax (Wales) Act to announce the rates and bands for each tax at the start of October.
Following the UK Government’s Autumn Budget, the Welsh Government will lay regulations to bring the tax rates into effect from April 2018. These regulations will be scrutinised and determined by the National Assembly of Wales.
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Source: letsrecycle.com Waste Managment
