Recommendation 15

HM Revenue and Customs (HMRC) explained that landfill tax was introduced in 1996 to encourage the public and organisations that generate or process waste to move away from using landfill to dispose of waste, and that revenue generation is not its primary purpose.52 The tax comprises a lower rate for waste that will not decompose and a higher rate for waste that will decompose and release greenhouse gases.53 From 2008 to 2014, the top rate of landfill tax increased significantly with annual above-inflation increases in the rate, while the lower rate barely increased.54 This had the environmentally beneficial effect of driving down the level of waste sent to landfill and increasing recycling – HMRC told us that there has been a 90% decrease in the amount of waste sent to landfill by local authorities. However, landfill tax also increases the incentives to dispose of waste illegally to avoid paying the tax.55