Lowest revenue from green tax in 13 years

Figures dropped from 7.7 per cent of total tax revenue in 2006 to 7.3 per cent in 2007

Green tax revenue has hit its lowest point in 13 years, lowering government coffers from 7.7 per cent of total revenue to 7.3 per cent.

The figures, revealed by the Office for National Statistics, include air passenger duty and fuel taxes.

The news is said to disappoint the government, which has pledged its commitment to the green agenda several times this year.

The figures are also revealed to have dropped for the past four successive years as the government sought to extract more cash from alternative taxes. Environmental taxes made up a record 9.4 per cent of revenue when Labour moved into power in 1997.

Simon Bullock of Friends of the Earth said the government had again failed to deliver on its repeated promise to shift taxes from people and on to pollution.

"Increasing taxes on fossil fuels is an essential weapon in the government's armoury for tackling climate change. And if Alistair Darling used these extra taxes to cut those on people and jobs, it would be extremely popular too," said Bullock.

The news is also likely to disappoint green business leaders who have been calling for a major overhaul of the UK tax system in favour of more green taxes.

Speaking at the launch last week of the CBI's report on climate change, director-general Richard Lambert called for a " fundamental redesign" of the UK's tax and regulatory system that would remain revenue neutral but would "give businesses and consumers the incentives to do the right thing".

A Treasury spokesman said it was important to look at the "whole package" of environmental policies.

A version of this article first appeared at http://www.accountancyage.com/