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HM Revenue and Customs Brief 08/11


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Issued  03 March 2011

Modernising landfill tax legislation – material qualifying for the lower rate of tax


The purpose of this Brief is to explain changes that are being made to the legislation relating to the lower rate of landfill tax.

A Treasury Order, the Landfill Tax (Qualifying Material) Order 1996 (Opens new window), lists the materials that qualify for the lower rate of landfill tax. This Order will be replaced by the Landfill Tax (Qualifying Material) Order 2011, which comes into force on 1 April 2011 and has effect for disposals of qualifying material made, or treated as made, on or after that day.

Who needs to read this?

Businesses registered for landfill tax or that produce waste that is disposed of at landfill sites registered for the tax.


Following a joint HM Revenue & Customs/Treasury consultation the previous year, the June 2010 Budget announced that the qualifying criteria that Treasury take into account when deciding the waste materials that are liable for the lower rate of landfill tax, would be amended from 1 April 2011. These criteria were published in December 2010 and are set out at Annex A.

The Finance (No 3) Act 2010 section 24 (Opens new window) amended section 42 of the Finance Act 1996 to provide for the amendment and publication of these criteria.

Why is the 1996 Order being replaced?

The qualifying criteria for the lower rate of landfill tax, and the list of qualifying material that are eligible for it, have not been amended since the introduction of the tax in 1996.

The revisions being introduced by the 2011 Order arise primarily from the need to reflect changes in wider environmental policy and legislation since 1996, such as the implementation of the European Landfill Directive. The changes will improve the tax’s environmental effectiveness and ensure that decisions regarding the liability of different wastes are more transparent.

In particular, the 2011 Order will align the list of wastes subject to the lower rate with new criteria for lower rating. The key changes are outlined below and a copy of the 2011 Order and its Explanatory Note are at Annex B. No later than 1 April 2011 we will also publish the lower rating criteria and an extract from the new Order in our public notice LFT1 'A General Guide to Landfill Tax'

What will change from 1 April?

  • The wording of the Order will make it explicit that rocks and sub-soils that are currently lower rated will remain so.
  • Topsoil and peat will be removed from the lower rate, as these are natural resources that can always be recycled/re-used.
  • Used foundry sand, which has in practice been lower rated by extra-statutory concession since the tax’s introduction in 1996, will now be included in the lower rate Order.
  • Definitions of qualifying ash arising from the burning of coal and petroleum coke (including when burnt with biomass) will be clarified.
  • The residue from titanium dioxide manufacture will qualify, rather than titanium dioxide itself, reflecting industry views.
  • Minor changes will be made to the wording of the calcium sulphate group of wastes to reflect the implementation of the Landfill Directive since 2001.
  • Water will be removed from the lower rate – water is now banned from landfill so its inclusion in the list of lower rated wastes is unnecessary; where water is used as a waste carrier the water is not waste and therefore not taxable.

As a result of changes to waste regulation in Northern Ireland in 2002, we have also taken this opportunity to align with the rest of the UK the legislation covering the documentary evidence required there to support a claim to the lower rate. These changes were not, on their own, significant enough to justify an amendment to the Order before now.

What about disposals made, or treated as made, before 1 April 2011?

To be eligible for the lower rate of landfill tax and be treated as qualifying material, disposals of material made, or treated as made, on or before 31 March 2011 must meet the terms of the Landfill Tax (Qualifying Material ) Order 1996 (Opens new window).

Further information

For further information and advice please contact the Excise and Customs Helpline on 0845 010 9000.

Annex A – new lower rating criteria

In drawing up wastes to be listed in its lower rate Order, the Treasury will have regard to the criteria set out below. These are the principles that guide the Treasury’s considerations – a waste will be lower rated for landfill tax from 1 April 2011 only if it is listed as a qualifying material in the Landfill Tax (Qualifying Material) Order 2011, which will be laid before Parliament in spring 2011.


Wastes which are not 'hazardous’ within the meaning of the Council Directive on Hazardous Waste (91/689/EEC). (This should be superseded shortly by the revised Waste Framework Directive (2008/98/EC).)

Low potential for greenhouse gas emissions

Wastes which are not biodegradable, have a low organic content or do not break down under the anaerobic conditions that prevail in landfill sites to produce methane. These include inert waste within meaning given under the Landfill Directive; and waste with little or no organic content such as inorganic residues or completely combusted residues from the incineration of biodegradable/organic wastes.

Low polluting potential in the landfill environment

  • Waste where the contaminants are unlikely to become mobile in the landfill and any leachate produced has little or no pollution potential.
  • Where the pollution potential of the waste is reduced if deposited alone in mono-fill landfill sites or within separate cells (not mixed with other wastes) within a landfill site.
  • The engineering requirements for the landfill are lower that would be the case for a non-hazardous landfill (as laid out in the Landfill Directive) by virtue of a risk assessment agreed with the regulator.
  • The aftercare period and requirements are significantly lower than would normally be required for a non-hazardous waste landfill, based on a risk assessment agreed with the regulator.

Annex B

Draft Landfill Tax (Qualifying Material) Order 2011(PDF 33K)

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Article Published/Sorted/Amended on Scopulus 2011-03-06 18:10:12 in Tax Articles

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