Chamber
Meeting of the Parliament 17 December 2013
17 Dec 2013 · S4 · Meeting of the Parliament
Item of business
Landfill Tax (Scotland) Bill
An important argument in favour of increasing levels of fiscal devolution is that it can incentivise economic activity that brings more revenues to this Parliament. However, this particular piece of fiscal devolution works in the opposite direction since, ultimately, we want to collect as little tax as possible by incentivising people to move away from landfill.
That move has profound consequences for the block grant adjustment, which should basically be as small as possible. The bill’s financial memorandum predicts that landfill tonnages in Scotland will
“significantly decrease over the coming decade with a corresponding reduction in receipts.”
That is a necessary consequence of the laudable targets outlined in the zero waste plan, which proposes long-term targets of recycling 70 per cent of all Scotland’s waste and only 5 per cent of remaining waste ending up in landfill by 2025. The Scottish Government estimates that landfill tax receipts will fall from £107 million in 2015-16 to around £40.5 million in 2025—that should be our guiding figure when it comes to negotiations on the block grant adjustment.
Once we have this devolved tax, we need to drive it forward for economic purposes without worrying about the revenue consequences because the whole aim of the bill is to have less revenue, but we must also recognise the constraints facing us. Those have most commonly been expressed in terms of illegal dumping and waste tourism.
Sometimes the factors pull in opposite directions. For example, setting the rate for asbestos at zero would be good in stopping illegal dumping but would encourage waste tourism from England, and setting rates too high would encourage waste tourism from Scotland to England. The issues are complex, and careful deliberation is needed. It is therefore entirely right that the affirmative procedure should apply to the relevant secondary legislation.
Matters are a lot clearer in relation to the tax on illegal dumping. That is unreservedly good, as is the enhancement to the landfill communities fund, of which the cabinet secretary reminded us. Of course, we are disappointed that the Government rejected Michael McMahon’s amendment, which took the right approach in insisting on a link between a project and a landfill site. I hope that the guidance will embody that principle in some way.
The principles of the bill are sound when it comes to incentivising new technologies that take us away from landfill and challenging illegal dumping. The bill falls short, however, in that there is no certainty about the rates or whether there will be an escalator. Those matters are within the control of the cabinet secretary, and I hope that we will hear about them as soon as possible, if not today.
That move has profound consequences for the block grant adjustment, which should basically be as small as possible. The bill’s financial memorandum predicts that landfill tonnages in Scotland will
“significantly decrease over the coming decade with a corresponding reduction in receipts.”
That is a necessary consequence of the laudable targets outlined in the zero waste plan, which proposes long-term targets of recycling 70 per cent of all Scotland’s waste and only 5 per cent of remaining waste ending up in landfill by 2025. The Scottish Government estimates that landfill tax receipts will fall from £107 million in 2015-16 to around £40.5 million in 2025—that should be our guiding figure when it comes to negotiations on the block grant adjustment.
Once we have this devolved tax, we need to drive it forward for economic purposes without worrying about the revenue consequences because the whole aim of the bill is to have less revenue, but we must also recognise the constraints facing us. Those have most commonly been expressed in terms of illegal dumping and waste tourism.
Sometimes the factors pull in opposite directions. For example, setting the rate for asbestos at zero would be good in stopping illegal dumping but would encourage waste tourism from England, and setting rates too high would encourage waste tourism from Scotland to England. The issues are complex, and careful deliberation is needed. It is therefore entirely right that the affirmative procedure should apply to the relevant secondary legislation.
Matters are a lot clearer in relation to the tax on illegal dumping. That is unreservedly good, as is the enhancement to the landfill communities fund, of which the cabinet secretary reminded us. Of course, we are disappointed that the Government rejected Michael McMahon’s amendment, which took the right approach in insisting on a link between a project and a landfill site. I hope that the guidance will embody that principle in some way.
The principles of the bill are sound when it comes to incentivising new technologies that take us away from landfill and challenging illegal dumping. The bill falls short, however, in that there is no certainty about the rates or whether there will be an escalator. Those matters are within the control of the cabinet secretary, and I hope that we will hear about them as soon as possible, if not today.
In the same item of business
The Deputy Presiding Officer (Elaine Smith)
Lab
The next item of business is a debate on motion S4M-08609, in the name of John Swinney, on the Landfill Tax (Scotland) Bill. I invite members who wish to spe...
The Cabinet Secretary for Finance, Employment and Sustainable Growth (John Swinney)
SNP
I welcome the fact that we have reached the stage 3 debate on the Landfill Tax (Scotland) Bill, which is the second bill establishing devolved taxes in Scotl...
Bruce Crawford (Stirling) (SNP)
SNP
I put on record my thanks to the Government for the way in which it has engaged with me on a matter concerning my constituents in Blanefield. We are grateful...
John Swinney
SNP
I welcome Mr Crawford’s comments. He has advanced the interests of his constituents in the Blanefield area using all means available to him through the legis...
The Deputy Presiding Officer
Lab
There is no time in hand. I call Iain Gray. You have a maximum of seven minutes, but I would like you to take less than that if possible.15:26
Iain Gray (East Lothian) (Lab)
Lab
In the stage 1 debate, I referred to the landfill tax as a new tax. In his closing speech in that debate, the cabinet secretary corrected me—it is, of course...
The Minister for Environment and Climate Change (Paul Wheelhouse)
SNP
Would the member accept that even in the worst-case scenario that is set out in “Low Carbon Scotland: Meeting our Emissions Reduction Targets 2013-2027. The ...
Iain Gray
Lab
I think that the minister has more confidence in RPP2 than I do, but let us see what happens as time unfolds.That said, on diversion from landfill and increa...
The Deputy Presiding Officer
Lab
I now call Gavin Brown, who has five minutes or less.15:33
Gavin Brown (Lothian) (Con)
Con
I think that the bill commands broad support across the chamber. It was a pretty good bill at stage 1 and it has been strengthened marginally during the stag...
The Deputy Presiding Officer
Lab
You are in your final minute.
Gavin Brown
Con
However, it is worth while to think more carefully about the ultimate policy objective of that. Is it simply to tax the same level of investigations as we cu...
The Deputy Presiding Officer
Lab
I am afraid that you must close.
Gavin Brown
Con
It is worth while to reflect on that. We will certainly support the bill this evening.
The Deputy Presiding Officer
Lab
We turn to the open debate. I am afraid that I can only give speeches of three minutes to four members. I apologise to the fifth member, whom I will not be a...
John Mason (Glasgow Shettleston) (SNP)
SNP
It is always good to welcome a new tax, although I take the point that the landfill tax is, in fact, a replacement tax and that it is probable that many peop...
Michael McMahon (Uddingston and Bellshill) (Lab)
Lab
Like the land and buildings transaction tax, the Landfill Tax (Scotland) Bill has been very technical, but it has had a remarkably straightforward and consen...
Kenneth Gibson (Cunninghame North) (SNP)
SNP
As convener of the lead committee, I first thank the clerks, officials and witnesses who helped the Finance Committee in its deliberations as the bill progre...
Malcolm Chisholm (Edinburgh Northern and Leith) (Lab)
Lab
An important argument in favour of increasing levels of fiscal devolution is that it can incentivise economic activity that brings more revenues to this Parl...
The Deputy Presiding Officer
Lab
I apologise to Jean Urquhart, whom I have been unable to call. Gavin Brown, you can have a maximum of four minutes.15:51
Gavin Brown
Con
This has been a pretty good, if short, debate, which did not differ enormously from the debate at stage 1. That reflects the fact that very little has change...
The Deputy Presiding Officer
Lab
I call Iain Gray. I apologise that I can give you only five minutes.15:55
Iain Gray
Lab
This has been a short but interesting debate. It has also been a bit of a Donald Rumsfeld debate because a lot of known unknowns have been discussed. We do n...
John Mason
SNP
I wonder whether the member will accept my main point, which was that we can put more faith in John Swinney than we can in George Osborne.
Iain Gray
Lab
The degree to which we have to put faith in Mr Swinney is exactly the point to which I am coming. I thought that Mr Mason was rising to apologise to the cabi...
John Swinney
SNP
It is a mark of the fact that there has been no real division on the substance of the debate that Mr Mason has been harangued by Mr Brown and Mr Gray. We sho...
Gavin Brown
Con
Does the cabinet secretary accept that one reason for having a three-year lead time was so that we could look at the twice-yearly estimates until a position ...
John Swinney
SNP
It is a lot more stable now because the original estimate was complete baloney. If the member goes back to the December 2012 forecast, he will see that liter...
Mike MacKenzie (Highlands and Islands) (SNP)
SNP
I wonder whether that would encourage us to take other OBR forecasts, for instance for oil and gas revenues, with a very large pinch of salt.
John Swinney
SNP
We have to take care on a lot of those issues. Mr MacKenzie knows that the Scottish Government has a different view from the OBR on oil and gas predictions. ...