Treasury wavers over landfill tax reforms as industry warns of 100m bills

""This came as a huge shock," one executive said. "If the reforms are implemented as drafted, it will push costs beyond what is viable for many projects.""

""They are still trying to get a grip on the implications," said one source close to the talks. "They recognise the strength of feeling - it feels like"

"Under the current regime, landfill tax is charged at £126.15 per tonne, with a reduced rate of £4.05 per tonne for inert or less polluting materials such as soil, rocks and clay. Certain industries are eligible for exemptions and reliefs. The Treasury's reforms envisage scrapping the reduced rate altogether, while significantly narrowing exemptions."

Officials announced proposals in April to abolish the reduced landfill rate and narrow exemptions, prompting industry concern when the financial impact became clear in July. Under the current regime, landfill tax is charged at £126.15 per tonne with a reduced rate of £4.05 per tonne for inert materials such as soil, rocks and clay. The reforms envisage scrapping the reduced rate and significantly narrowing exemptions. Housebuilders, manufacturers and construction firms warn bills could rise from around £4 million to more than £100 million, with the removal of topsoil relief singled out as particularly damaging. Treasury cites high non-compliance and avoidance schemes as justification. More than 60 industry leaders met Treasury officials who acknowledged the strength of feeling and appeared to be assessing the implications.

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