The Green Budget – at a glance

Landfill Tax

The Treasury today confirmed that landfill tax will increase by £8 per tonne each year from 1 April 2011 until at least 2014.

There will also be a floor imposed under the standard rate of £80 per tonne, to ensure that the rate will not fall below £80 per tonne from April 2014 until at least 2020.

The move was welcomed by experts who said that it should help to stimulate investment in recycling capacity and waste-to-energy plants

Green cars

The Government said it would reform company tax so that it continues to provide an incentive to purchase the lowest emitting vehicles on the market.

From April 2011, the basic threshold for the 15 per cent band of company car tax will be reduced by five grams of carbon dioxide emitted per kilometre (g CO2/km) so the band applies to cars emitting between 121 and 129g CO2/km. The percentage of list price subject to tax will then continue to increase by one percentage point with every extra 5g of CO2/km up to a maximum of 35 per cent.

The most generous tax breaks will also only be offered on the greenest cars in the market with the existing 10 per cent band for cars emitting 120g CO2/km or less removed from April 2012. As a result the 10 per cent band will only apply to cars that emit
99g of CO2/km or less.

Green trucks

Legislation will be included in the Finance Bill to be introduced this autumn that will allow enhanced capital allowances to be extended to cover zero-carbon goods vehicles. The tax break will apply to vehicles purchased from April 2010, and will be in place for five years.

Infrastructure

Osborne admitted that the previous Conservative government of the early 1990s made a mistake in cutting infrastructure spending and promised that the government will make no further cuts in public sector gross investment compared with the plans that it inherited.

It also promised to publish a national infrastructure plan in the autumn and pledged to set up a new Infrastructure UK body to oversee infrastructure decisions.

Carbon Price

The budget provided scant further detail on how the government plans to impose a floor price on carbon, but insisted that it was working on the issue.

It said that it would publish proposals in the autumn that will centre on reforms to the climate change levy. It added that subject to consultation it intends to bring forward relevant legislation in the 2011 Finance Bill.