Consultation on devolved Welsh landfill tax

HMRC has announced a four week technical consultation on legislation covering the devolution of landfill tax to Wales and closure of the landfill communities fund (LCF)

Landfill tax is to be devolved to Wales in April 2018. Landfill tax then will no longer apply to disposals of waste in Wales, and the Welsh government will introduce a landfill disposals tax (LDT) as a replacement.

The draft legislation introduces the changes needed to make sure that landfill tax is paid on all disposals up until 31 March 2018, even if it would normally be accounted for at a later date. This will allow LCF funds to continue being spent on projects in Wales for a two year transitional period following devolution.

HMRC notes that when the tax is devolved, some environmental bodies may be holding unspent funds derived from contributions by landfill operators across England, Northern Ireland and Wales.

The regulations also establish a transitional regime so that landfill operators who have previously made contributions to environmental bodies carrying out work in Wales will remain eligible for a tax credit provided those contributions are spent within two years of the date upon which devolution of landfill tax takes place and in certain other circumstances.

The consultation closes on 4 January 2018.

Technical consultation seeking views on the draft statutory instrument for devolution of Landfill Tax to Wales and closure of the Landfill Communities Fund (LCF) is here.

Report by Pat Sweet

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