Opposition hits out at energy tax

Financial Secretary Stephen Timms insisted the EnvironmentChange Levy is ‘well designed’ and does ‘create a favourableenvironment’ for such schemes.

But he confirmed during detailed debates on the Finance Billthat does not mean power sold by combined heat and power schemes tothe grid will be free of the tax.

The tax came under fire from the Tories who described it as ‘dotty’ and’completely unnecessary’. The Liberal Democratsbacked the tax, but attacked the way it is being implemented.

Shadow Chief Secretary and Accountant MP David Heathcoat-Amorysaid the proposals were ‘extremely complicated’, breaching thegovernment’s tax simplification project, with rebates limited toprivileged sectors.

He accused the Government of breaking promises over CHP.Liberal Democrat Andrew Tyrie said the tax should have beenimposed ‘upstream’ where fuel is burned creating carbon dioxidedischarges and exempt hydro power.

Timms said the tax will apply to local authorities, who willhowever benefit from reductions in NICs.

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