Energy and Climate Change Secretary Chris Huhne signalled today that increases to green taxes are high on the Government's agenda.
Speaking in a debate on green taxes at the Lib Dem conference in Liverpool Mr Huhne said that the green sections of the coalition agreement were some of the strongest parts and commitments on green tax were very important to the government.
He said that the commitment to increase the share of taxes taken from green taxation won’t only be through aviation taxes and the climate change levy though he was not specific about any further changes.
Responding to criticism that green taxes can be regressive he said the government could make a lot of progress on this agenda without being unfair. There were plenty of options – they could use green taxes to increase income tax threshold, or to cut employers’ NICs. He said there was evidence that a 'green tax switch' is popular so long as people can see extra revenue is being used to reduce other taxes.
He challenged his party "to develop an ambitious green tax package that we can argue for in government."
The party backed a motion approving the commitments in the Coalition Programme for Government to increase the proportion of tax revenue accounted for by environmental taxes, reform the taxation of air travel by switching from a per-passenger to a per-plane duty, and introduce a floor price for carbon, and applauding the inclusion in the June 2010 Emergency Budget of commitments to reform the Climate Change Levy and to explore options for changes to aviation tax.
The full text of the motion can be read here.
In his leader's speech to the conference today Nick Clegg reiterated the Government's determination to crack down on tax evasion and avoidance (as set out in the Chief Secretary's speech yesterday and reported in a separate blog post). He also said ministers were "working hard with our friends in Europe and beyond on the idea of a financial activities tax on profits, pay and bonuses."
A significant section of the speech was devoted to devolution of tax powers:
"We will put local government back in charge of the money it raises and spends. That’s why in our first budget we unlocked more than a billion pounds of ring-fenced grants. That’s why we will end central capping of Council Tax. That’s why we will allow councils to keep some of the extra business rates and council tax they raise when they enable new developments to go ahead. And I can announce today that we will be giving local authorities the freedom to borrow against those extra business rates to help pay for additional new developments."
He reiterated the commitment to taking forward the Calman Commission "to give Scotland real freedom and responsibility over its own money" and said that, "if the referendum for more devolution in Wales is successful, we will take forward a similar process for the Senedd."
You can read the full speech here.
George Crozier, CIOT External Relations Manager, in Liverpool, 20/09/10
(NB. The CIOT is, of course, strictly politically neutral and reports will also be posted on tax developments from the Labour and Conservative conferences over the next two weeks.)
