Government urged to commission a review of environmental taxes
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...made the UK tax system less attractive to would-be investors.”
This report confirms that although environmental taxes are playing an increasingly prominent revenue-raising role, the existing policy landscape prevents their full potential being realised. Businesses need a more strategic framework with an effective coordinated approach across Government.
To achieve this, the CBI is calling for an urgent review of all environmental taxes by an independent body, like the Committee on Climate Change or the Office for Tax Simplification.
In the long-term, the CBI recommends that the Government takes a more joined-up and strategic approach to its environmental taxation policies, and recognises six fundamental business guidelines for any new or changed environmental tax:
- To have a clear purpose and definition;
- To take strategic fit into account;
- To be designed with simplicity at their core;
- To offer comprehensive communication and advice;
- To provide certainty to businesses;
- To ensure a strong, ongoing justification.
In its report, the CBI also makes specific practical recommendations as to how each guideline should be implemented.
Rhian Kelly, CBI Director for Business Environment policy, said: “The current uncoordinated approach to environmental taxes is not working for business. An independent review of environmental taxes has become an urgent priority. With a more joined-up approach, environmental taxes could provide certainty for businesses, unlock investment, and reduce the impact on the environment without damaging UK competitiveness.”
The CBI research shows that the most poorly regarded tax is the CRC, which is not working to encourage business energy efficiency. It has become an overcomplicated revenue-raising instrument, which is simply being written off as a cost of doing business in the... continued on page three >