It appears that despite the new LOI regime coming into force in April 2015, there remains reluctance from some landfill operators willing to accept waste that meets LOI and requisite conditions. Our members have reported that either their local landfill operator point blank refuses to accept material, or the gate-fee is disproportionately high!
We met with the Environmental Services Association on 23rd June to discuss this issue, in the hope that communications with their members, (which encompass all the major landfill companies) will allay concerns about embracing the new regime and lead to a consensus that it is appropriate and legal to accept trommel fines originating from waste transfer stations. We welcome your feedback in relation to how you are managing the new regime, if it is proving beneficial, or if you are incurring any problems?
It was rather concerning when MPs made several negative comments at a scrutiny debate at Westminster on 16th June. The new legislation was formally laid for approval but not without a number of questions being raised as to the effectiveness of the regime.
Alison McGovern, MP for Wirral South, aired her view that HMRC is unable to enforce the regime due to a lack of resources, whilst Kevan Jones, MP for North Durham, stated he thinks it will be practically impossible to enforce, and landfill tax fraud is one of the largest scandals that is yet to be addressed in the country. He went on to say that he believes there is confusion between HMRC and the Environment Agency in terms of enforcement and more needs to be done to make those who fill up sites with waste and abandon them responsible for landfill tax avoidance, usually operators that undermine legitimate prices and undercut those who are doing it properly.
Andrew Bridgen, MP for North West Leicestershire, made the point that the higher the tax, the greater the incentive for operators in the industry to evade it. This is a point that UROC agrees with. As we presented in last month’s Skip Hire Magazine, the huge gap between low rate (£2.60) and standard rate (£82.60) does not necessarily encourage operators to recycle more, especially if they cannot meet LOI at 15% (10% from April 2016). Again, we call for your opinion on whether a middle rate tax should be introduced to bridge the gap?
In response to a question raised about the sampling procedure for LOI testing, the Minister stated that there is probably no fool-proof or fraud-proof system for taking samples. People will seek to get around the regime, but the challenge in compliance is to interrupt that activity and stop it. In the past 15 months, HMRC has accelerated its response to tax aspects of waste crime. It has a range of responses, including criminal and civil investigations, and the national waste sector task force takes cross-tax approaches.
Further, in the 2015 Budget, the coalition Government provided £4.2 million of funding to the Environment Agency specifically to tackle waste crime. That will enable it to take action against more illegal waste sites and illegal waste exports. HMRC acts on information indicating non-compliance and fully engages with key partner agencies, most notably the Environment Agency, to ensure that compliance and enforcement activity is properly co-ordinated.
UROC applauds any action taken against illegal waste operators, however, we do not fully support the additional legal enforcement tools that have been proposed, or the approach of the Agency in ‘over regulating’ legitimate operators.
The last point made in the debate was in relation to potential waste tourism from Scotland, due to the LOI regime not being adopted there as yet. Assurances were given that HMRC and the Environment Agency are working closely with Revenue Scotland and SEPA. UROC will be sitting on the Working-Group to represent our members north of the border.
The amount of work and effort that has gone into devising the new regime should not, in our opinion, be undermined by skepticism and lack of confidence in our sector. We need to step up to the mark and demonstrate that we are keeping to our end of the deal by applying the regime appropriately to our operations!