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Chancellor fails to mention levy in pre-budget speech fuelling lobby group's hopes Quarry firms sense 'green' tax victory

THE QUARRYING industry believes plans for a £2.3 billion 'environmental tax' on aggregates are set to be axed after Chancellor Gordon Brown failed to make mention of it in his pre-budget speech last week.

Briefing notes released after the speech said that the tax was 'only one instrument' among others under consideration for next May's budget. Alternative measures to reduce the environmental impact of quarrying include using planning consents and regulation to force quarry owners to adhere to 'green' criteria.

The Quarry Products Association (QPA) has met with 100 MPs as part of a lobbying campaign, launched after the Chancellor first suggested the tax measure in last July's budget.

The association's director general, Simon van der Byl, said he was 'very pleased' with the latest development.

He said: 'We welcome the move to consider the role that planning consent and regulation currently play in managing the environmental impact of quarrying.'

If a levy were imposed, UK construction firms could face a £2.3 billion bill, supposing that quarried materials used by building firms were taxed at £10 per tonne.

The QPA's economist, Jerry Mc-Laughlin, illustrated the impact such a level of tax could have. If the government now wished to build 20 new hospitals, he said, it might only be able to afford 17, if such a tax were levied.

He said: 'At the end of the day, you would get a ridiculous situation, with health authorities paying tax back to the treasury.'

A team of government-appointed consultants has been carrying out an evaluation of the proposed tax over the past four weeks. They are asking home owners living near 20 major quarries across the UK to put a cost on any problems caused by the quarrying.

The consultants will publish an interim report on their findings in January with a final draft due in March.

The results of the survey should guide Treasury officials when they consider whether to impose a tax next spring.

The consultants are to report back to a steering group within two weeks. The group comprises government officials, county planning officers and representatives from the QPA and the Confederation of British Industry's minerals committee.