No end in sight for Aggregates Levy

ON 13 September the European Court of First Instance (CFI) dismissed the British Aggregates Association’s long-standing legal challenge to the aggregates levy under state aid rules.

The court ruled that the decision to introduce an environmental levy falls within the power of EU member states to set their own priorities in the economic, fiscal and environmental fields. It said the UK was, accordingly, free to determine, as part of its environmental policy, the minerals used as aggregates which it considered appropriate to tax and to exempt certain other materials.

Commenting on the judgement, BAA director Robert Durward said the court’s decision would effectively mean a continuation of the nonsense of adjacent quarries producing virgin aggregate where one pays the £1.60 per tonne tax and the other does not, and he vowed to continue to campaign to have the levy removed on the grounds that it is not only bad for the environment but is also highly discrimatory in nature.

Mr Durward added that the CFI judgment also appeared to represent a significant shift in policy by moving it away from previous legal precedent set by the European Court of Justice (ECJ), the EU’s highest court. According to previous case law, environmental concerns could not justify a difference in treatment between different sectors which had the same environmental impact. This formed a major part of the BAA’s case.

‘Last month’s judgment suggests that the CFI –– the EU’s second highest court –– now disagrees with this position,’ said Mr Durward. ‘This may be wrong as a matter of law and the BAA is presently considering its options. If legal opinion supports the view that the CFI judgement is not in accordance with the law, then an appeal may be lodged in the ECJ against the decision of the CFI.’

The BAA has two months to register an appeal following the court’s judgement.