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Skip tax 'U-turn'

Skip tax 'U-turn'
The taxman was accused of a fresh U-turn today after HMRC issued new guidance on the so-called 'skip tax'.

HMRC published fresh advice following an outcry from skip operators about changes unveiled only a week ago to the landfill tax which the industry claimed would have seen an increase in the rate to dump a tonne of rubbish in landfill sites from £2.50 to £64.

Labour has seized on the move, linking it to other U-turns on taxes on pasties, caravans, and charitable donations in the last week. Rachel Reeves attacked George Osborne, saying in a statement:

"With four tax u-turns in a week when Parliament is not sitting George Osborne is clearly in a complete mess. The country needs a full-time Chancellor 100 per cent focused on getting us out of the double-dip recession caused by his mistakes.”

But HMRC emphasised earlier there was “no change of policy” but issued clarification about what materials should attract the £64 rate and what should attract the £2.50 rate.

The Treasury insisted that the new guidance was not a ministerial decision and was not linked to any Budget U-turns this week. "It is an operational matter for HMRC," a source told PoliticsHome.

Labour MPs have welcomed the news, with Siobhain McDonagh tweeting: “We've won! HMRC have backed down! The dreaded #skiptax is no more!”

Meanwhile Tom Watson added: “Treasury have climbed down on the 2500 % skip tax hike - withdrawing the guidance issued last Friday. Another u-turn.”

Skip drivers had threatened to disrupt this weekend’s Diamond Jubilee celebrations in protest against the 2500% rise in duty, and they also staged a noisy protest last week in Parliament Square over the plans.

Green Box: Skip tax 'U-turn'Click to open

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