Speech on the Landfill Tax Bill

Sadly we ran out of time in the Chamber this afternoon and I wasn’t able to speak in the debate on the third and final stage of the Landfill Tax (Scotland) Bill. I’ve been part of scrutinising this Bill all the way through, as a member of the Scottish Parliament Finance Committee.

Landfill Tax may not seem like the most exciting topic, but it is exciting that from 2015, for the first time, Scotland will set and collect two of its own national taxes (the other being the Land and Buildings Transaction Tax) instead of relying on London. Ideally we would have responsibility for all taxation in Scotland, so we can have taxes that fit Scotland’s economy and our progressive values – that’s one of the reasons I’m campaigning for a Yes vote in the referendum.

Here is the speech I would have given, if we’d had time:

Thank you, Presiding Officer.

It gives me great pleasure to speak at this stage 3 debate. I am extremely proud to have the opportunity to be a part of this important Bill, and have enjoyed scrutinising it as a member of the Finance Committee. I’d like to add my thanks to the Bill team and the Finance committee.

Presiding Officer, members will be aware that the Landfill Tax Bill will directly replace the UK Landfill Tax regime. In terms of what constitutes a taxable disposal according to the UK Landfill Tax arrangements, the Scottish Bill will start with an identical set of exemptions. This is a useful starting point, as it will give Revenue Scotland and SEPA the opportunity to get their bearings so to speak. However, the Bill gives the Scottish Government the opportunity to add or remove exempted material through subordinate legislation, which I think is important. That gives the Scottish Parliament and the Scottish people the chance to influence taxation and I believe that is something that most, if not all across the chamber would welcome.

As the Law Society of Scotland has said, a Scottish Landfill Tax makes sense. It enables the Scottish Government to deliver a more joined-up approach in relation to its zero waste aims. It allows the Scottish Government to deliver a tax system that is tailor-made to Scotland’s environmental landscape, the scale of production and consumption, and the businesses that operate within the environmental landscape. The Scottish Landfill Tax will play an important role in maintaining the economic stimulus required to harness waste management opportunities and direct the Scottish economy toward a prosperous future with secure access to resources. Additionally, there will be new opportunities for the Scottish Government to directly raise local revenues from Scottish businesses for local use. I believe that all members would be interested to see the Scottish Landfill Tax be successful in its aims, and will work together in order to adjust critical aspects of the tax to bring it into line with shifts in policy and external circumstances, for example.

Presiding Officer, I believe that the Landfill Tax Bill, alongside the Land and Buildings Transaction Tax and the Revenue Scotland and Tax Powers Bill – introduced to Parliament by Finance Secretary John Swinney last Thursday – represents a critical juncture in tax collection and management in Scotland. Like the Cabinet Secretary and the Scottish Government, I believe that the Scottish Parliament should have legislative responsibility for the full range of taxes levied in Scotland.

I believe that would be the best and only way for the Scottish economy to flourish and reach its potential. I believe that Scottish control over all taxation in Scotland is the only route to a fairer, redistributive tax system. I believe that a fully independent Scottish tax system will be a key means to maintain our public services. A Yes vote in September next year would allow the Scottish Government to design a simpler, yet fairer tax system for Scotland with those goals in mind.

Of course the Scottish Landfill Tax won’t be perfect initially. There may be skills gaps to be addressed moving forward. For example, SEPA is an environmental regulator rather than a tax assessor, and we should allow SEPA time to adjust. The Finance Committee has a key role to play here, as Revenue Scotland and SEPA will report to the Committee on a 6 monthly basis in order to ensure an affective monitoring process. However, the salient point is that the Scottish Government has been presented with the opportunity to show that it can be relied upon to effectively design and manage important areas of taxation. I have the utmost confidence that the Scottish Government has the experience, the knowhow and the ability to carry out the provisions of the Landfill Tax Bill effectively, and thus make a success of the new devolved Scottish Landfill Tax. That goes for the Land and Buildings Transaction Tax and any other devolved taxes in the future.

Presiding Officer, I see the Landfill Tax Bill as a worthy and valuable piece of legislation. It does what it is supposed to do. It provides legislative provisions for a Scottish Landfill Tax to replace the UK Landfill Tax regime. However, it also does much more. It provides the Scottish Government with real power to take important decisions on a crucial area of taxation, makes use of the experience and expertise of the Scottish Environment Protection Agency, and is conducive to the Scottish Government’s Zero Waste Agenda as we look to Greener energy alternatives. I hope to see everyone involved in implementing and monitoring the Scottish Landfill Tax coming together to grasp this fantastic opportunity with both hands. Together, we can display the benefits of devolved taxation to the public and to business, and make a real difference to both the environment and to business in Scotland.

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Speech: Stage 1 Landfill Tax Bill (29th October)

I am delighted to have the opportunity to speak on the Landfill Tax (Scotland) Bill and I welcome its stage 1 completion. I thank fellow members of the Finance Committee for their commitment, interest and dedication in scrutinising the general principles of this important bill. I also thank the Government for its feedback on the committee’s report, which has made the Government’s position clear on a number of the committee’s concerns.

As a result of the bill, the Scottish ministers will become the tax authority for the purposes of the Scottish landfill tax. That is a great step forward. I have confidence in the ability of the Scottish ministers and their staff to take responsibility for the Scottish landfill tax as well as for other important taxes such as the Scottish rate of income tax. The bill enables ministers to make an order to designate another tax authority, and I welcome the move by the Cabinet Secretary for Finance, Employment and Sustainable Growth to set up a new body, revenue Scotland, as Scotland’s tax authority for devolved taxation. Revenue Scotland already exists as an administrative function within the Government, and the Government has been consulting on provisions to establish it on a statutory footing.

The Government has indicated that it intends that the administration and collection of the Scottish landfill tax should be undertaken by the Scottish Environment Protection Agency on behalf of revenue Scotland. Landfill tax administration and collection would become a new function for SEPA, which already visits and inspects landfill sites as part of its environmental regulation duties. That would offer significant advantages for the Government. The existing knowledge and considerable expertise in SEPA will create opportunities for significant efficiencies and other operational benefits in relation to the administration and collection of the Scottish landfill tax. I therefore support the Scottish Government’s intention to have SEPA in charge of the administration and collection of the tax.

Although I give full support to the general principles of the bill, I draw the Parliament’s attention to two areas of concern. First, I believe that one further waste exemption could be considered. Part IIA of the Environmental Protection Act 1990 states:

“If no person has, after reasonable inquiry, been found who is by virtue of subsection (2) above an appropriate person to bear responsibility for the things which are to be done by way of remediation, the owner or occupier for the time being of the contaminated land in question is an appropriate person.”

That means—I think—that individual property owners might end up footing the bill for contaminated land remediation through no fault of their own. There are live examples of individual householders who have been charged vast sums for the remediation of contaminated land.

In the Cabinet Secretary for Finance, Employment and Sustainable Growth’s statement to Parliament on 7 June 2012, he described four principles that underlie the Government’s approach to taxation and he reiterated them today. They are certainty, convenience, efficiency and that the tax is proportionate to the ability to pay. It is that final principle that I believe is relevant here. My suggestion is that consideration should be given to including in the bill a measure to allow for the costs of contaminated land remediation to be waived if an individual property owner is found to be on contaminated land, has in no way caused the contamination but yet has been unfortunately designated the status of appropriate person because of the lack of someone being found who actually caused the contamination. By putting such a measure in place, the Scottish Government would ensure that its principle of taxation being proportionate to the ability to pay is adhered to.

The second concern relates to the committee’s suggestion that there should be a lower rate of tax on island waste, for materials for which there are never likely to be viable recycling or recovery routes. Although the Government has made its position clear on that, I still believe that a review of the issue could be carried out. In Shetland, Enviroglass provides a local solution for Shetland’s waste glass by recycling all the glass that is collected by the local authority through its bottle banks. That has been essential in minimising the financial and environmental costs that shipping glass to mainland UK for recycling would incur. However, not all island communities are fortunate enough to benefit from such a scheme and a review could help to find alternatives for the islands that lack the means to cheaply recycle waste materials.

A final aspect of the bill that I will speak about relates to the Scottish Government’s zero waste agenda, which is an ambitious programme of change that aims to create an environment in which we make the most of resources and minimise Scotland’s demand on primary resources. That is to be achieved by maximising the reuse, recycling and recovery of resources rather than treating them as waste. The Scottish landfill tax will play an important role in maintaining the economic stimulus that is required to harness those waste management opportunities and in directing the Scottish economy towards a prosperous future with secure access to resources. By doing so, Scotland could follow the great example of its Nordic neighbour Sweden and make productive use of waste that would otherwise build up at landfill sites.

We must ensure that environmental organisations continue to be supported by the landfill communities fund. The Scottish Wildlife Trust, for example, has received £3.6 million to date, which has helped it to develop and manage essential environmental and community projects.

The Landfill Tax (Scotland) Bill is a good and valuable piece of legislation. It does what it is supposed to do: it provides legislative provisions for a Scottish landfill tax to replace the UK landfill tax regime. It provides the Scottish Government with real power to take important decisions on a crucial area of taxation and makes use of the experience and expertise of the Scottish Environment Protection Agency. It is conducive to the Scottish Government’s zero waste agenda as we look to greener energy alternatives. Therefore, I support the general principles of the bill.