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2020 / 2021 Edition

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BAA says warning has come true

Robert Durward

Operators facing ‘massive shock’ as HMRC begins process of recovering illegal state aid on shale aggregates

AS HM Revenue & Customs (HMRC) begins the process of recovering unpaid aggregates levy on shale aggregates, the British Aggregates Association (BAA) says its fears over exemptions to the levy have been realized.

In a press release issued this week, the BAA said that although it had been warning the UK Government since 2002 that a large number of quarry operators were being put at risk by suspect exemptions to the aggregates levy, government Ministers had chosen to ignore the Association in the mistaken belief that its legal challenge would fail.

In March this year, the EU Commission issued a decision following its 18-month Phase II investigation into the aggregates levy exemptions. Although most of the exemptions were found to be lawful, the decision supported the BAA’s position by finding illegal state aid (in the case of shale aggregate) and ordered that this should be recovered from its recipients.

HMRC has now begun the process of recovering the unpaid levy by sending legally enforceable questionnaires to the companies concerned.

The BAA says the sheer scale of this problem will undoubtedly come as a massive shock to those affected. The Association estimates that a company which sold just 100,000 tonnes of shale aggregates per annum (between 1 April 2002 and 31 March 2014) will now owe the Treasury £2.15 million. In addition, it has been calculated that compound interest could add another £840,000 to this liability.

HMRC has said that although it will be sympathetic to those struggling to repay the illegal state aid, it will not be possible to avoid complying with the EU order.

As a number of BAA members have been caught up in this situation, the Association says it has been compelled to seek additional legal advice. Any operator who is concerned about this issue is advised to contact the Association without delay through the normal channels.

BAA director Robert Durward (pictured) said: ‘The ill-conceived aggregates levy continues to cause havoc within the aggregates industry. Not only have we repeatedly warned the Treasury about this danger, on several occasions we have also offered to settle the dispute on an amicable basis. The Government now needs to take decisive action to prevent dozens of companies being made bankrupt.’

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Submitted by CAT (not verified) on

This is completely WRONG and UNFAIR! This will be the end for many operators that have tried their best to work legally within HMRC's boundaries! HMRC are the ones that have made the mistake and they should be the ones to shoulder the blame!

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