The
In an update on the situation, the BAA says: ”Following a favourable judgment by the EU General Court, HMRC [HM Revenue and Customs] are being compelled to suspend most of the exemptions and the Treasury has opened a consultation (
“This consultation is open for submissions until November 15th and all quarry operators are strongly advised to contact aggregateslevy@hmtreasury.gsi.gov.uk register for the consultation and make their feelings plain about the difficulty of paying a £2.00 per tonne, additional tax in the middle of a serious recession, especially in a market often skewed by exempt materials from other quarries.
”HMRC faces major problems in complying with EU law as it is not simply a case of them removing exemptions. In many cases they will have to identify and approach companies who are not registered for the Levy, inform them that not only will they have to start paying £2.00 [€2.36] per tonne from April 2014 but they will also be liable to pay for the previous eleven years as well. As you can imagine this will go down like a lead balloon and Customs will know this. How many companies will have eleven [soon to be twelve] years of sales figures and how many, if any, companies could survive a retrospective payment of this magnitude?
”Quarry companies in Northern Ireland are particularly exposed. They are all registered and they have all submitted AGL returns so HMRC has a record of their sales. NI operators had a derogation, when we were paying £1.60 they were only paying 32p and then 40p to our £2.00. The derogation was withdrawn in December 2010 and NI operators have since been having enormous problems with cross border competition and exempt materials.
”The only rational way out of this mess for all parties is for the Aggregates Levy to be scrapped and replaced by a modest levy of 10p per tonne to be used to fund projects nearby the operating site. This would not require any input from HMRC and would be administered by the local community council in partnership with the operating company.
”However, to get to this point, we will first of all have to convince Treasury that the Levy in its present form is unacceptable, commercially regressive and economically flawed. The BAA recently asked the
”Quarry operators are also advised to copy any representations made to the Treasury consultation to their MP.”
MPA statement on BAA Aggregates Levy update
The MPA has made a statement on its position on the “assertions put forward by BAA.”
Nigel Jackson, Chief Executive MPA, said: “The MPA and prior to that QPA [Quarry Products Association] have always stated that the Aggregates Levy is a bad environmental tax and both organisations have been consistently opposed to it.
“Both Treasury and BIS [Business, Innovation and Skills Department] are aware of the MPA view which we repeat regularly. Our strategy has been to try and mitigate the rate of growth of the levy which to date is worth around £70 million as a result of three freezes in indexation we alone have argued for.
“MPA has taken the view that Government is unlikely to remove the levy as it is ‘hard baked’ into both Treasury forecasts and environmental thinking. We have been aware from the outset that the exemptions and reliefs would be liable to both legitimate use and abuse and would require modification at some point with the likelihood that Treasury would seize the opportunity to increase its tax take from the sector rather than reduce it.
“The over-riding issue for our members has been the creation of a level playing field and consistent and rigorous enforcement. MPA has taken the view that whatever the outcome of any legal action either in the UK or EU the Government ‘owns the goalposts’ and will move them to recover revenues whatever the justification.”
