Budget 2012: Carbon Reduction Commitment to be reformed or axed
Chancellor George Osborne yesterday (March 21st) announced that the Carbon Reduction Commitment (CRC) would be replaced with a simpler environmental tax system if the current scheme cannot be simplified within the next six months.
In his Budget speech to the House of Commons, Mr Osborne said he wanted to ensure the 20,000 businesses required to report to the CRC were not unfairly hit by the administrative costs of compliance.
“The Carbon Reduction Commitment was established by the previous government,” he said. “It is cumbersome, bureaucratic and imposes unnecessary cost on business. So we will seek major savings in the administrative cost of the Commitment for business.
“If those cannot be found, I will bring forward proposals this autumn to replace the revenues with an alternative environmental tax.”
Speaking to BusinessGreen, a spokeswoman for the Department of Energy and Climate Change (DECC) said it would launch a consultation on simplifying the CRC on 27th
March, focusing on the reporting process, the length of time businesses will be required to store information, as well as the metrics used for the performance league table.
The Treasury intends to engage with businesses before the autumn if a replacement is to be introduced. Yesterday the Treasury also confirmed that any allowances sold for the 2012-13 emissions would be priced at £12 per tonne of carbon dioxide.
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