30 May 2012

Landfill Tax destroys construction jobs by mistake!

Most of my posts are about writing. Every now and then, I get personally involved in something hidden from public view that demonstrates that even a well-meaning piece of legislation can be so badly botched as to destroy whole industries.

Take this week's landfill tax fiasco.

Her Majesties Revenue and Customs have almost unlimited power to write their own legislation and guidance. Last year, they produced a Statutory Instrument that amended the rules about what types of waste paid standard rate landfill tax (64 pounds per tonne) and what paid lower rate (2.50 pounds per tonne)

Obviously, there's quite a difference.

When they introduced the new rules HMRC told Parliament that there would be no economic effect to them.

One year later, HMRC have informed industry that construction industry soils have to pay standard rate tax.

They also say that they will be looking to collect the difference retrospectively.

About 1.4 billion pounds, if they go back one year.

1.4 billion pounds that the house builders and other parts of the construction industry will have to find every year from now on.

The claw back, if allowed to happen, will put most companies out of business. The forward tax will price homes further from the reach of first time buyers.

I spoke to HMRC, asked them to clarify their policy then told them of the consequences. They said they didn't realise. They said that someone from the industry should have told them last year.

They almost said oops! but not quite.

So change it back, I said.

Can't they said.

Who is responsible for ruining all these lives? I asked.

We all are. They replied. But it's mostly a man called Darren Greedy who works in the policy department in Salford.

Naturally, I have started to inform interested parties, including MP's who should take the blame for letting HMRC do what they like.

There's going to be a few stormy meetings in Westminster before I've seen the back of this one.

We live in interesting times.

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