The Scottish Government has commissioned us to review, model and analyse options for a Scottish specific Aggregate Levy.

The UK Aggregates Levy, introduced in 2002, is an environmental tax on aggregates (sand, gravel and rock) that have been dug from the ground, dredged from the sea or imported – usually for the construction of roads and buildings – and is designed to promote the use of recycled aggregates.

Currently, the UK Aggregates Levy covers Scotland, and in anticipation of the transfer of legislative responsibility to Scotland following the Scotland Act 2016, the Scottish Government has commissioned new research on a Scottish Aggregates Levy. The work will review the historical development, and impacts of, the UK Levy, and use these findings to develop policy options for a Scottish specific Aggregates Levy. These options will be informed by experience elsewhere, we have previously reviewed environmental taxes in place in all 28 EU Member States, including a range of levies on natural resources.

The research will be used to advise Ministers on options for supporting Scotland’s aims to achieve a Zero Waste Society. Scotland is now a world leader in the transition to, and promotion of, a circular economy.

Previous research we carried out for Zero Waste Scotland found that construction waste currently accounts for 44% of all waste arising in Scotland. The Scottish Environmental Protection Agency (SEPA) states that 29 million tonnes of construction aggregate are used annually, of which around 20% of the demand is met by recycled aggregates.

Eunomia’s team of environmental consultants will carry out economic and econometric modelling, along with detailed analysis of various policy options to assess their potential impacts on the Scottish economy and the aggregates industry.

Eunomia has a long history of researching, analysing and modelling environmental taxes. Most recently, Eunomia produced a case study on the UK Aggregates Levy, which looked specifically at the history of the levy and its impact as part of an ongoing project for DG Environment at the European Commission. The consultancy also has an in-depth understanding of Landfill Tax, an environmental policy that supports the Aggregates Levy in encouraging the use of secondary materials.

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