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Contractors call for slice of rebate

MATERIALS - Amec has written to quarriers asking for a share of any aggregates levy rebate

MAIN contractors have started to press quarriers for the return of cash paid to them since a tax on aggregates was introduced in April 2002.

They want quarry operators to pay back huge sums of money if European courts rule that the Government must repay almost £1.5 billion in aggregates levy collected since its introduction.

Amec is one of those contractors angling to claim back aggregates tax from stone suppliers.

It has written to quarry operators asking for details of any claims lodged with the Government.

In a letter, Amec's supply chain director Andy Haworth wrote: 'We should be grateful if you could let us know whether your organisation has submitted a claim in respect of potentially overpaid aggregates levy. Amec will wish to seek reimbursement from your organisation of the levy it has paid on its purchases of aggregate.' But contractors will be disappointed if they think any ruling by the European Court of First Instance that finds the tax illegal will ensure an unexpected bumper pay-day, according to quarriers.

Robert Durward, director at industry body the British Aggregates Association, which mounted the court challenge, said: 'The money is simply not there for contractors to claim back. It is nigh on impossible for any quarry operator to say what level of tax has been passed on to a client. In many cases producers will have absorbed the levy, in others they will have passed some of it on.' According to Mr Durward the problem stems from the Government administrating the levy as a 'direct' tax. This means that the quarry operator has to pay the levy to the Treasury but does not have to reclaim it from customers.

He said: 'The Government demands £1.60 per tonne of aggregate produced from operators irrespective of whether it has been able to pass this amount on to the client. It does not have to appear on invoices and on many products it has been impossible to pass on any of the extra cost.'