Source · Select Committees · Public Accounts Committee
Recommendation 26
26
We asked HMRC what it had done to quantify the impact of Landfill Tax on...
Conclusion
We asked HMRC what it had done to quantify the impact of Landfill Tax on the exporting of waste and fly-tipping.52 HMRC said that it knew there is a risk that Landfill Tax will incentivise illegal dumping or exports, but said other departments had lead responsibility for these forms of waste disposal, with local authorities also having responsibility for fly-tipping. HMRC said it did not hold information on fly-tipping. But it added that while there is evidence that fly-tipping is a growing problem, it had found no clear correlation between fly-tipping and rates of Landfill Tax. HMRC stated it was supporting the work of other departments on exports, including through the joint waste crime unit, but the witnesses did not know how much Landfill Tax was lost from waste being illegally exported.53
Government Response
Not Addressed
HM Government
Not Addressed
5: PAC conclusion: HMRC has not done enough to evaluate how tax measures with environmental objectives have changed behaviour. 5: PAC recommendation: HMRC should ensure that it has sufficient information to assess whether environmental taxes are achieving their objectives and whether they are having wider impacts, including unwanted behaviour change. 5.1 The government agrees with the Committee’s recommendation. Target implementation date: Winter 2021 5.2 The government agrees it is important that HM Revenue & Customs (HMRC) should ensure it has sufficient information to assess the impacts of environmental taxes, including whether they are achieving their objectives. 5.3 HMRC already uses data and information from various sources to assess whether environmental taxes are achieving their stated environmental objectives and to identify and address unwanted behaviour and risks. For example, this led to the introduction of the Unauthorised Waste Sites measure to tackle non-compliance with Landfill Tax and wider waste sector regulatory requirements. HMRC is also building into the design of Plastic Packaging Tax mechanisms to support effective evaluation of its performance against stated environmental objectives. 5.4 Further activity will need to be considered within HMRC’s overarching approach to evaluation and monitoring. Evaluation can be time consuming and expensive, so the evaluation plans will need to be proportionate, in order to appropriately direct taxpayers' money. And, as the NAO has recognised, it can be extremely difficult to disaggregate the impact of tax measures from other spending and regulatory measures, or other wider factors that drive the behaviour of individuals and businesses. 5.5 Decisions on publication of evaluation and monitoring information are a matter for Ministers.