The Chancellor has announced he will fund the Landfill Tax liabilities that arise from the clearance of illegal waste sites for Defra and local authorities.
In his first Budget as Chancellor, John Healey announced funding to cover Landfill Tax liabilities for Defra that arise from the planned clearance of six illegal waste sites.
Earlier this year, the Department for Environment, Food, and Rural Affairs (Defra) committed to funding the clearance of some of the country’s most egregious illegal waste sites, including Bolton House Road in Wigan.
The Chancellor’s announcement means Defra will not be required to pay Landfill Tax costs when clearing these sites.
Healey also committed to introducing a three-year pilot scheme, starting in 2027, to fund local authorities’ Landfill Tax liabilities that arise from the clearance of illegal waste sites in their areas.
Elsewhere in the Budget, the Chancellor confirmed an increase to the standard rate of Landfill Tax by RPI.
He said the lower rate of Landfill Tax would rise by the cash amount of the increase in the standard rate in England and Northern Ireland, preventing the difference between the rates getting wider.
Mike Maudsley, CEO of energy-from-waste (EfW) enfinium, welcomed the adjustment to landfill tax, which he said ‘reinforces the importance of avoiding waste and using unrecyclable material as a resource’.
“Maintaining a clear incentive to divert waste towards more sustainable solutions will help support the UK’s energy security while making better use of the resources we have,” Maudsley said.
Healey also announced changes to the Landfill Communities Fund (LCF), a scheme where landfill operators receive tax credits for donating money, which is then distributed to approved environmental bodies.
These include an increase to the cap of tax credit claimable by landfill operators from 5.3% to 8.3% of their Landfill Tax liability.
The Chancellor also announced changes to the Plastic Packaging Tax (PPT) following consultation. From April 2030, mechanically recycled plastic used in plastic packaging will be subject to mandatory certification as part of PPT.
