Budget backs green agenda
Ahead of the COP26 UN climate summit, the Chancellor’s budget featured a strong green agenda. With policies announced to reduce emissions, ensure the country is resilient to climate change, and create economic opportunities.
With key announcements including at least £800m to deliver two new Carbon capture storage (CCS) clusters the first by the mid-2020s and the second by 2030. Although the locations weren’t confirmed the Chancellor spoke of areas such as Merseyside and Humberside. It also plans to support the delivery of the country’s first CCS power plant.
Alongside this the government plans to double the size of the Energy Innovation Programme, invest £1bn into green transport and launch the new Nature for Climate Fund which will invest tree planting and peatland restoration in England, increasing the rate of tree planting and covering an area the size of Birmingham.
With road travel a major contributor to carbon emissions, the government laid out £532 million for consumer incentives for ultra-low emission vehicles, and reduces taxes on zero emission vehicles. It also announced plans to ensure that drivers will never be further than 30 miles from a rapid charging station.
The areas of heating, waste and recycling also saw announcements around new taxes and the funding of the Heat Network Investment Project.
Tax Partner at Garbutt + Elliott, Becky Maguire commented “It was pleasing to see a number of green measures announced today – albeit balanced out by significant new spending on the road network and a freeze on fuel duty. From a tax perspective, the green agenda will be boosted by a Plastic Packaging Tax from April 2022. We also had confirmation of the previously announced company car tax boost for electric cars and the most efficient hybrid vehicles. It was welcome news to hear that the 2% Benefit in Kind rate by 2022/23 will also be frozen until 2024/25 and there is an extension to vans. This along with the funding announced for Rapid Charging is good news for those looking to take the leap to electric.