Environmental Taxes Bulletin commentary (June 2024)
Updated 28 June 2024
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1. Headlines
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total provisional Climate Change Levy (CCL) and Carbon Price Floor (CPF) receipts for the financial year 2023 to 2024 were £1,828 million, which is £266 million (13%) lower than the financial year ending 2023
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total provisional Landfill Tax (LFT) receipts for the financial year 2023 to 2024 were £489 million, which is £137 million (22%) lower than the financial year ending 2023
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total provisional Aggregates Levy (AGL) receipts for the financial year 2023 to 2024 were £350 million, which is £29 million (8%) lower than the financial year ending 2023
2. About this release
This bulletin was created in June 2021 and is updated annually every June. The content was previously published in three separate bulletins and was created following a consultation on the reduction and consolidation of HMRC statistics publications.
HMRC welcomes user engagement to improve the departments National and Official Statistics. You can contact statistics producers on GOV.UK or the team responsible for this bulletin directly at revenuemonitoring@hmrc.gov.uk.
National Statistics are accredited official statistics.
This publication provides statistics for:
- CCL and CPF
- LFT
- AGL
The latest release has been updated with provisional receipts data up to May 2024 and provisional declarations data to April 2024.
Difficulties faced by taxpayers submitting returns during the coronavirus pandemic also means these statistics should be treated with additional caution for the financial year ending in 2021.
The ‘Environmental Taxes Bulletin’ is Crown Copyright. The information contained can be used as long as the source is made clear by the user.
3. Historical trends in environmental tax receipts over the past 10 years
Figure 1: Total environmental tax receipts for the previous 10 financial years, in £ million
Receipts for financial year ending 2024 are provisional.
Figure 1 demonstrates the following trends:
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CCL and CPF together are the largest environmental tax. Receipts for them have been generally rising over the period shown, apart from the financial years ending 2021 and 2024 in which receipts dropped
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LFT receipts were decreasing each year until the financial year ending 2022, in which receipts increased compared to the previous year. In the financial years ending 2023 and 2024 however, receipts returned to a decreasing trend
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AGL has been the smallest of the three environmental taxes over the past 10 financial years. Receipts have shown a gradual increase up to the financial year ending 2020, after which there has been more fluctuation. The financial years ending 2023 and 2024 have seen receipts from this tax decrease, reflecting a shift from taxable to exempt tonnage
Table 1: Financial year environmental tax receipts for the previous 10 complete financial years, £ million
| Financial Year | CCL and CPF | LFT | AGL |
|---|---|---|---|
| 2014 to 2015 | 1,491 | 1,144 | 342 |
| 2015 to 2016 | 1,763 | 919 | 356 |
| 2016 to 2017 | 1,864 | 874 | 374 |
| 2017 to 2018 | 1,861 | 757 | 376 |
| 2018 to 2019 | 1,922 | 683 | 367 |
| 2019 to 2020 | 2,004 | 641 | 397 |
| 2020 to 2021 | 1,778 | 566 | 359 |
| 2021 to 2022 | 1,930 | 667 | 410 |
| 2022 to 2023 | 2,094 | 626 | 378 |
| 2023 to 2024 | 1,828 | 489 | 350 |
4. Climate Change Levy and Carbon Price Floor receipts and declarations
CCL is chargeable on the industrial and commercial supply of taxable commodities for lighting, heating and power by consumers in the following sectors:
- industry
- commerce
- agriculture
- public administration
- other services
CCL does not apply to taxable commodities used by domestic consumers or charities for non-business use.
CCL is charged on taxable supplies. Taxable supplies are certain supplies of the following taxable commodities:
- electricity
- natural gas as supplied by a gas utility
- petroleum and hydrocarbon gas in a liquid state
- coal and lignite
- coke and semi coke of coal or lignite
- petroleum coke
CPF is a tax on fossil fuels used in the generation of electricity. It was achieved through changes to the existing CCL regime for gas, solid fuels and liquefied petroleum gas (LPG) used for electricity generation. These changes included the introduction of new carbon price support (CPS) rates of CCL.
This publication provides National Statistics for CCL and CPF receipts and declarations by fuel type:
- electricity
- gas
- solid and other fuels, including liquefied petroleum gas (LPG)
It is not possible to provide accurate separate receipts statistics for CCL and CPF because taxpayers pay receipts for both as one payment. An estimate of separate receipts statistics for CCL and CPF is provided using taxpayer returns data and should be treated with caution.
CCL and CPF taxpayers mainly follow quarterly accounting periods. Tax returns are due by the end of the month following the accounting period. Payment of tax is also generally due to HMRC by the same time, but taxpayers who pay by direct debit are given a 7 day extension.
These accounting periods and payment patterns cause a 1 to 2 month lag between accounting periods ending and receipts being received by HMRC.
Figure 2: Total CCL and CPF receipts by financial year, in £ million
Receipts for the financial year ending 2024 are provisional.
Figure 2 demonstrates the following trends for total CCL and CPF receipts:
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receipts fell substantially in financial year ending 2021, as national COVID-19 lockdown policies reduced the demand for energy generated from commodities covered by CCL and CPF. For the financial year ending 2023, CCL and CPF receipts returned to above pre-pandemic levels before falling again in the financial year ending 2024
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in the financial year ending 2023, CCL and CPF receipts reached their highest level at £2,092 million. The previous peak was in the financial year ending 2020 at £2,004 million
Figure 3: Total CCL and CPF declarations split by electricity, gas, and solid and other fuels by financial year
Declaration figures for financial year ending 2024 are provisional.
Figure 3 demonstrates the following trends for total CCL and CPF declarations:
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electricity declarations have generally increased since financial year ending 2015, with the highest level being in financial year ending 2020. From the financial year ending 2021 to the financial year ending 2024, the level of receipts has held fairly steady, with some fluctuation
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gas receipts increased substantially each year until the financial year ending 2017, after which receipts were more stable. In the financial years ending 2023 and 2024 however, we see a substantial rise followed by a fall
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declarations for solid and other fuels have followed a downward trend, reflecting declining quantities of coal used for electricity production in the UK. In financial years ending 2022 and 2023 there was a small rise in the use of solid and other fuels compared to the previous financial year, before receipts for these fuels again decreased to their lowest ever level in the financial year ending 2024
5. Landfill Tax receipts and declarations
LFT is a tax paid by landfill operators on the disposal of material at a landfill site. The tax is passed onto businesses and local authorities through the gate fee for disposing of waste at a landfill.
The tax aims to provide incentive for the diversion of waste from landfill to other less harmful methods of waste management such as recycling and incineration.
The tax is charged by weight. There are two rates: standard rate and lower rate.
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lower rate applies to non-hazardous and less polluting materials
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standard rate applies to all other taxable materials including all disposals at an unauthorised site
With effect from 1 April 2023, the following rates apply:
- lower rate: £3.25 per tonne
- standard rate: £102.10 per tonne
Exemptions exist for dredging, mining and quarrying waste, pet cemeteries, filling of quarries and waste from visiting forces.
Figure 4: Total LFT receipts by financial year
Receipts for financial year ending 2023 are provisional.
Figure 4 demonstrates the following trends to LFT receipts:
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LFT receipts have fallen substantially over the last 10 financial years. The financial year ending 2021 was impacted by the Coronavirus (COVID-19) pandemic, and after a rise in receipts the following year, financial years ending 2023 and 2024 are continuing the downward trend
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LFT rates have increased significantly over the past 10 years while receipts have fallen, indicating a marked decrease of landfilling activity over this period
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a ‘shortfall’ in LFT receipts should not be considered a concern because the tax aims to provide incentive for the diversion of waste from landfill to other less harmful methods of waste management such as recycling and incineration. This turn away from standard rated waste can be seen below in the declarations data
Figure 5: Total LFT tonnage declared split by taxable tonnage, taxable tonnage of which relieved and exempt tonnage by financial year
Tonnage figures for financial year ending 2024 are provisional.
Figure 5 demonstrates the following trends for LFT tonnage:
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total tonnage has shown a downward trend over the last 10 years. A small rise in the financial years ending 2022 and 2023 directly following the start of the COVID-19 pandemic was short lived, with tonnage in the financial year ending 2024 being the lowest so far
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standard rate tonnage as a proportion of total tonnage has fallen consistently over the 10 year period
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lower rate tonnage as a proportion of total tonnage increased from 31% in financial year ending 2019 to 43% in financial year ending 2021 (with some fluctuation over this period), with this proportion then falling to 41% by the financial year ending 2024
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exempt tonnage as a proportion of total tonnage has shown an upward trend over this period while the overall level has remained fairly stable, due to the reduction in overall tonnage of waste. Exempt tonnage made up 25% of total tonnage in the financial year ending 2021 and has risen to 36% of total tonnage in the financial year ending 2024
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LFT tonnage declared for financial year ending 2024 is 19,330 thousand tonnes which is 3,026 thousand tonnes (14%) lower than the previous financial year
6. Aggregates Levy receipts and declarations
AGL covers digging, dredging or importing aggregate commercially in the UK.
The current rate is £2.03 per tonne.
Traders become liable for the levy when an aggregate is:
- used for construction purposes
- mixed with anything other than water (excluding special circumstances)
- removed from:
- its originating site
- a connected site which is registered under the same name as the originating site
- a site where it had been intended to apply an exempt process to it, but this process was not applied
Total AGL tonnage declared is calculated by summing taxable and exempt tonnage declared (relieved tonnage is excluded from the calculation in order to avoid double counting as it’s contained within taxable tonnage). As taxable tonnage forms the majority of the total tonnage declared, the pattern of total tonnage is dominated by patterns in taxable tonnage.
Figure 6: Total AGL receipts by financial year
Receipts for financial year ending 2024 are provisional.
Figure 6 demonstrates the following trends for AGL receipts:
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AGL receipts were generally increasing until the financial year ending 2020, after which we see more volatility in the receipts. Receipts have been dropping in the financial years ending 2023 and 2024
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financial year ending 2021 would have been impacted by the Coronavirus (COVID-19) pandemic
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the Aggregates Levy rate remained constant over the period shown in the graph at £2 per tonne, with the increase to £2.03 per tonne coming in April 2024. Any impact of this change is not yet visible in the data
Figure 7: Total AGL tonnage declared split by taxable tonnage, taxable tonnage of which relieved and exempt tonnage by financial year
Tonnage declarations for financial year ending 2023 are provisional.
Figure 7 demonstrates the following trends for AGL tonnage declarations:
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total AGL tonnage demonstrates an upward trend from 222 million tonnes in financial year ending 2015 to 251 million tonnes in financial year ending 2020. There has since been a reduction with provisional tonnage for financial year ending 2024 at 232 million tonnes
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the proportion of taxable tonnage to total tonnage has generally been stable over this period, fluctuating between 92% and 93% from financial year ending 2015 to financial year ending 2022. In the financial years ending 2023 and 2024 this proportion decreased to 89% and 86% respectively, indicating a shift from taxable tonnage to exempt tonnage
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total AGL tonnage declared for the financial year ending 2024 is 232,117 thousand tonnes, which is 339 thousand tonnes (less than 1%) lower than the previous financial year