Environmental tax

Environmental taxes initially affected relatively few businesses. New taxes, such as plastic packaging tax and windfall taxes on energy companies, however, mean that environmental taxes now affect a broad range.

In the UK, the main environmental taxes relate to packaging, affecting many retail companies, and energy usage, affecting the technology sector and many less obvious industries.

UK environmental taxes include the following:

• Plastic packaging tax
• Windfall taxes on energy companies
• Climate change levy
• Energy reliefs
• Landfill tax
• Aggregates levy

Our environmental tax team can help you see if your business is liable for any of these taxes and ensure you are making full use of the reliefs available.

Most environmental taxes are indirect taxes levied once in the supply chain by the taxable person. Who the taxable person is depends on the tax being charged:

• the manufacturer or importer of plastic packaging for plastic packaging tax
• the landfill site operator for landfill tax
• the energy supplier for the climate change levy
• the quarry operator for the aggregates levy

Windfall taxes on energy are treated differently. They are direct taxes administered through the corporation tax return.

Although environmental taxes are only levied once in the supply chain, they impact the market price of goods and services and affect pricing throughout the supply chain. By increasing the cost associated with the behaviour the Government wants to discourage, these taxes encourage alternative, less polluting behaviour by everyone.