MPA lobbies on tax reduction

The UK’s aggregates organisation the 2897 Mineral Products Association has called on government to reduce the level of and re-assess the environmental rationale of the Aggregates Levy. The call comes after the government announced plans to scrap the Aggregates Levy Sustainability Fund through which part of the tax weas used to fund local projects around quarries.

According to the MPA, the Aggregates Levy is nominally an environmental tax, but has been subject to no environmental assessment, has no related environmental benchmarks and provides no incentive for aggregates producers to improve environmental performance. The association has said that it is environmentally ineffective.

The levy is scheduled to rise again in April 2011 to £2.10 per tonne and has increased by over 30% since introduction. The MPA has said that these increases have been imposed in spite of continuing improvements in the sustainability of the aggregates industry, both in terms of operating standards, the restoration and aftercare of industry sites and the supply of essential materials to improve the quality and performance of our infrastructure and built environment.

MPA chief executive Nigel Jackson said, “There are clearly major questions about the environmental performance and relevance of the levy and the additional costs it is imposing on construction clients and the supply chain at a time when government needs to focus on policies encouraging economic growth and not imposing additional costs.

“The ALSF was designed as an integral element of the levy in recognition that the levy itself is a blunt instrument and more targeted spending and interventions were necessary to generate environmental and community benefits. The fact that government has now decided to scrap the ALSF further diminishes the levy's environmental credentials and turns it into a straightforward revenue raising measure and not an environmental tax.

“There is now a golden opportunity to support communities in quarrying areas by creating a new fund which recycles part of the levy directly into new ‘local community trusts’ while also retaining funding to support key projects relating to biodiversity, climate change, the marine environment and the strategic mineral planning system

“Government is now reviewing its approach to environmental taxation and The MPA has been pleased to contribute to this process - it is now the right time to reconsider future policy in relation to the Aggregates Levy and the Aggregates Levy Sustainability Fund in the broader context of our industry's sustainability performance and we hope The Treasury will react positively to this proposal."