Landfill tax — Exemption for works of restoration — Whether all landfill works undertaken pursuant to planning permission and licence amounting to restoration — Judge holding only works subsequent to capping qualifying — Section 43C of Finance Act 1996 — Appeal dismissed
The appellant was a landfill site and land reclamation operator. It acquired a site that had formerly been used as a quarry, and which had then been partly infilled with waste materials and restored to a poor standard. Planning permission had been granted for a scheme of landscaping and restoration of the site. This involved the deposit of inert materials for recontouring, after which the site was to be capped with clay. A waste disposal licence provided for the progressive filling of the site followed by the clay capping.
The appellant gave written verification to the respondents of its intention to begin the restoration, and claimed a full exemption from landfill tax for the amount of waste to be deposited under the scheme. It maintained that the work qualified for exemption as, inter alia, “restoration” under section 43C of the Finance Act 1996. Restoration was defined as “work, other than capping waste, which is required by a relevant instrument to be carried out to restore a landfill site to use on completion of waste disposal operations”. The respondents rejected the claim for exemption. That decision was overturned by the VAT and Duties Tribunal but was restored on appeal by the respondents. The judge held that the term “restoration” applied only to the final part of waste-disposal operations required by a relevant instrument to be carried out to restore the site to a use other than disposal of waste by landfill. He identified three stages: (i) the filling in of the site; (ii) the construction of the cap; and, finally, (iii) the work of restoration. He therefore held that the tribunal had erred in holding that all the works under the permission and licence amounted to restoration. The appellant appealed.
Held: The appeal was dismissed.
Where a section used an undefined term that would nevertheless be understood in the industry, such as “capping waste” in section 43C, it was proper to construe it having regard to industry practice and usage. That practice was, in the case of putrescible waste or an inadequately restored site such as the present, for the disposal of waste to proceed in three separate stages as identified by the judge. The permission and the licence were consistent with the work to be carried out involving three categories of work, of which restoration would be the last. That conclusion was supported by the express exclusion from the section 43C exemption of “capping waste”, which might otherwise have been understood to be included in the restoration of landfill sites. If the exemption had been designed to cover all disposals of inert waste made for the purposes of restoring a derelict site to beneficial use, there would have been no policy reason for excluding the capping layer.
Paul Shadarevian (instructed by Courts & Co) appeared for the appellant; Owain Thomas (instructed by the solicitor to Customs & Excise) appeared for the respondents.
Sally Dobson, barrister
