Green tax strategy slated by MPs

by Rachael Singh

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07 Feb 2012

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A view of cooling towers at a nuclear power plant in the distance

THE GOVERNMENT'S refusal to define what it constitutes as a green tax is making it difficult to ascertain whether environmental promises are being met a group of MPs has warned.

Pre-election the Conservatives promised to increase revenues from green taxes as a way of reducing environmental damage and shifting taxes away from work and income, The Guardian reports.

However, the government's refusal to define environmental taxes is making it difficult to judge whether these promises have been kept.

Joan Walley, chair of the Environmental Audit Committee, which produced a report about seven months ago calling for a definition, said: "[This] is an unacceptable delay. It is also unacceptable, after such a long interval, to provide an incomplete response, which does not address our pivotal recommendation for clarity about what constitutes an 'environmental tax' and the need for an environmental taxation strategy."

"Our inquiry last year showed that the Treasury was undermining public trust in green taxes by appearing to use them as a revenue-raising tool rather than a serious attempt to change environmentally damaging behaviour. While we continue to wait for an environmental tax strategy, people will not be able to have confidence in the government's tax motives," she added.

The government is sending out mixed signals on the definition, according to Walley. HMTreasury excludes air passenger duty and fuel duty as environmental taxes but, the governent's own Office for National Statistics includes them.

A Treasury spokesman said: "As the economic secretary made clear to the committee this week, the government continues to work on a definition of environmental taxes. The government remains committed to increasing the proportion of tax revenue accounted for by environmental taxes."

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