FDs brand climate change tax strategy 'pathetic'

The government is using green issues to raise general taxation, and not in a coherent strategy to combat global warming, finance directors have said.

The nation’s FDs deliver the assault on government eco-tax strategy in this month’s edition of Financial Director, Accountancy Age’s sister magazine.

Eighty-five percent of FDs believe the government is using green issues as another avenue through which to increase taxes on businesses and that the revenue raised will not go towards green issues, the survey reveals.

One FD said that the government’s strategy was ‘haphazard and confused’ with another commenting that: ‘The climate change levy (tax) has been in place for a number of years and there is nothing to show for it. Frankly, I do not believe it [government] has a clue where to start.’

One FD described the strategy as pathetic. ‘Once again industry is being hammered for its [government’s] inability to deal with the worldwide issue. The costs to industry are staggering in order to comply with current legislation.’

The survey also suggests that a high proportion of businesses take only a passing interest in environmental issues. Almost 20% of those surveyed said environmental considerations played no part at all in the company’s decisions.

Responding to a separate question, over 80% of FDs said that environmental issues were ‘very’ or ‘quite important’ to their organisation.

Of those surveyed, 44% said that they made green decisions to grow the bottom line and 13.2% said it was to improve their public relations.

Anna Mitchell of Friends of the Earth, said that ‘green taxes have a role to play, but they have got to be clear and address the concerns that businesses have’.

A spokesman for the Treasury admitted that the funds raised from green tax charges would not go solely towards environmental causes, but a consolidated fund. ‘We are not saying that we will recycle the funds’.

But it is the view of the Treasury that the green taxes are in place ‘to incentivise’ and ‘change the behaviour’ of businesses.