UT (Tax & Chancery) UT/2023/000101 - [2025] UKUT 00072 (TCC)

Landfill tax was introduced in 1996 as a domestic initiative aimed at protecting the environment. The tax was not a requirement of EU law but it did help to fulfil the UK’s obligations in EU law to take appropriate steps to encourage the prevention, recycling and processing of waste. It was intended to reduce the amount of waste, reduce the amount of material going to landfill and place the cost of landfill on the person disposing of the waste: see Customs & Excise Commissioners v Parkwood Landfill Ltd [2002] EWCA Civ 1707 at [9] and [10]. The purpose of landfill tax is to change behaviour, rather than just raise revenue. There is nothing wrong in principle with a landfill operator seeking to reduce its liability to landfill tax by recycling waste: see Barr v Revenue Scotland [2011] UT 11 at [43] and [45].

Other provisions have the same policy goals. The Waste (England and Wales) Regulations 2011 establish a duty on undertakings producing waste or involved in waste management to take all reasonable measures to apply the priorities described in the “waste hierarchy”, which is as follows:

The aim is to push waste up the hierarchy as far as possible away from disposal, which is viewed as a last resort, to prevention.

These regulations and the explanatory note accompanying them also refer to reducing the overall impact of resource use, improving the efficiency of resource use and improving the use of waste as a resource.

The policy goals behind these regulations and behind landfill tax itself are consistent with Council Directive 1999/31/EC on the landfill of waste; this encourages prevention, recycling and recovery of waste, the use of recovered materials and energy so as to safeguard natural resources and the reduction and treatment of hazardous waste. There is also Commission Implementing Decision (EU) 2018/1147 dated 10 August 2018 which is concerned with establishing best available techniques (“BAT”). BAT 22 refers to material efficiency and states that in order to use materials efficiently, best available technique is to substitute materials with waste. It specifically refers to waste being used instead of other materials for the treatment of other wastes, for example using waste alkalis or waste acids for pH adjustment.