Alistair Darling’s first pre-Budget report is due in October, but the overall
feeling, from an environmental perspective, is not to expect too much.
Gordon Brown has been in negotiations with Europe to reduce the VAT
percentage on energy efficient products for some time, so far with no success.
Daniel Lyons, tax partner at Deloitte, believes that Darling will not be
making any major changes. However, he goes on to say that the government has
brought about tax reforms – such as landfill – at the right pace, giving
companies the chance to adapt.
According to PricewaterhouseCoopers tax partner John Manning, if Darling were
to use the pre-Budget report to target environmental policy, there could be more
emphasis put on carbon trading, branching out to incorporate more companies and
sectors. He adds that it makes good business sense for companies to wisen up on
efficiency so as not to be hit with the carbon-tax stick.