Recommendation 32

We found the picture for cross-government working on the operation of a tax was more complex when we looked in detail at Landfill Tax and the Carbon Price Support. Landfill Tax has had both positive and adverse impacts, and HMRC described it, and by extension all environmental taxes, as “a relatively blunt financial incentive”.63 A 2018 independent review of serious and organised crime in the waste sector said that since its introduction in 1996 the tax had “been transformational in commoditising waste as a resource, but a consequence of its introduction has been to increase the attractiveness of the market to organised crime”.64 HMRC estimates that the misclassification of waste at authorised landfill sites and waste disposed at unauthorised sites reduced Landfill Tax revenue by around £275 million in 2018–19 (28% of the tax due). This figure does not include tax lost from the illegal exports of waste and from fly-tipping.65