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2020 / 2021 Edition

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BAA reports significant progress in AGL challenge

Robert Durward

Association says two challenges to Aggregates Levy appeals have been successfully overcome

THE British Aggregates Association (BAA) says it has successfully overcome two challenges to Aggregates Levy (AGL) appeals lodged at the EU General Court. The EU Commission, supported by the UK Government, made the challenges on the grounds of admissibility.

‘This has been yet another example of the Commission and the Treasury acting in concert to have our case delayed or struck out on technical grounds,’ commented BAA director Robert Durward.

‘They have tried every trick in the book to avoid having to justify this Levy before a proper court of law but they are now running out of places to hide.’

The BAA is appealing the 2015 Commission decision that all the AGL exemptions, with the exception of shale aggregate, complied with state aid law, despite what the Association says is a ‘great deal of evidence to the contrary’.

The Association is also appealing the 2014 decision by the Commission that the Northern Ireland Aggregates Levy Credit Scheme (ALCS) was compatible with state aid law, whilst admitting that the ALCS might not comply with the Treaty on the Functioning of the European Union (TFEU).

The Commission claimed that any breach could be rectified retrospectively by limited repayment to UK-based importers – a position that, according to the BAA, is regarded in legal circles as being ‘highly questionable’.

‘Since we first launched our challenge in 2002 we have been encouraged by several judgments which have strengthened our position,’ said Mr Durward.

‘One in particular opens the door to the industry recovering repayment of the Levy in full from 2002 onwards under the ‘Boiron principle’.

‘Our challenge to the Phase II decision on the Aggregates Levy Credit Scheme in Northern Ireland is also well founded in law. Another win for the BAA on the ALCS would have far-reaching and serious consequences for the quarry industry in Northern Ireland.’

Mr Durward continued: ‘Our industry has experienced a great deal of consolidation over the years with the majors buying up SME operators, often to close them down. Before the introduction of the Levy, this process had all but stopped and the SMEs were staging a comeback.

‘However, family companies are again succumbing to the majors and the Levy has undoubtedly played a part in this process. SME companies with only one or two sites find it difficult to cope with a tax set at such a high level.’

The BAA says that although it is ‘prepared to see this case through to its inevitable conclusion’, it has written to the new Chancellor, Philip Hammond, restating the Association’s preference for a negotiated settlement.

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