UK Government accused of aiming for income not impact with Green Taxes

The UK government is too focused on raising money from green taxes, rather than checking they are actually working, a spending watchdog says.

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Taxes aimed at helping the environment raised £34.7bn in 2019, according to the National Audit Office. But in most cases the tax authorities do not measure whether they are having any impact, the NAO says in a report. HM Revenue and Customs said the government was fully focused on hitting net-zero carbon emissions by 2050. But the NAO said too little was known about the effect of environmental taxes, and government departments must monitor their impact to help reach climate goals. The watchdog found that the Treasury and HMRC “do not centrally oversee” how the tax system impacts on climate targets. The only tax measured for effectiveness was the landfill tax, which had helped cut the demand for rubbish dumps, according to the NAO. There are currently four green taxes levied by the Government:

  • the climate change levy – a tax collected by energy suppliers and paid by businesses and the public sector to encourage reduced greenhouse emissions
  • the carbon price support – aims to drive electricity generators to invest in low-carbon electricity by increasing the cost of the fossil fuels they use
  • the landfill tax – a tax on landfill operators to divert waste from landfill to other less harmful methods of waste management
  • the aggregates levy – a tax to encourage the use of recycled materials over the extraction of rock, sand and gravel which can damage the environment.

However, it remains unseen as to how effective the levies are, with the Government seemingly not focussing on this aspect of the taxes.

Now Read

European Commission seeks to fix directive to protect environment


Climate change: UK not checking if green taxes work – spending watchdog, BBC, 2021-02-12

By Lukas Frisch Tonkinson.

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