Finance Act 2019

PART 3 U.K. Carbon emissions tax

Introductory U.K.

69 Carbon emissions tax U.K.

(1) A tax called “carbon emissions tax” is to be charged in accordance with this Part.

(2) The Commissioners are responsible for the collection and management of carbon emissions tax.

Commencement Information

I1 S. 69 in force at 23.7.2020 for specified purposes, see s. 79(1)(a) (as substituted by Finance Act 2020 (c. 14), Sch. 12 para. 8(2))

Charge to tax U.K.

70 Charge to carbon emissions tax U.K.

(1) Carbon emissions tax is charged, in relation to a regulated installation, if the amount of reported carbon emissions for a reporting period exceeds the emissions allowance for the period.

(2) The amount of “taxable carbon emissions” in relation to the installation for the reporting period is the amount of the excess.

(3) Carbon emissions tax is charged on taxable carbon emissions at the rate of £16 per tonne of carbon dioxide equivalent.

[F1 (4) The Treasury may by regulations provide that carbon emissions tax is not charged in relation to regulated installations of a specified description.]

Textual Amendments

F1 S. 70(4) inserted (22.7.2020) by Finance Act 2020 (c. 14), Sch. 12 para. 3

Commencement Information

I2 S. 70 in force at 23.7.2020 for specified purposes, see s. 79(1)(a) (as substituted by Finance Act 2020 (c. 14), Sch. 12 para. 8(2))

71 “Reported carbon emissions” U.K.

(1) The amount of “reported carbon emissions” in relation to an installation for a reporting period is the total amount of emissions from the installation, in tonnes of carbon dioxide equivalent, that is stated—

(a) in the emissions determination (or, if there is more than one, the latest emissions determination) for the period, or

(b) if there is no such determination, in the emissions report for the period.

(2) In subsection (1), “emissions determination” means the regulator's estimate of the total amount of emissions from the installation for the period, determined in accordance with—

(a) article 70 of the Monitoring and Reporting Regulation, or

(b) regulation 44 of the Emissions Regulations.

Commencement Information

I3 S. 71 in force at 23.7.2020 for specified purposes, see s. 79(1)(a) (as substituted by Finance Act 2020 (c. 14), Sch. 12 para. 8(2))

72 “Emissions report” and “reporting period” U.K.

(1) In this Part, “emissions report” means a report of emissions that is submitted to the regulator for the purpose of complying with—

(a) the monitoring and reporting requirements or, in the case of an excluded installation, the monitoring and reporting conditions, or

(b) a requirement of a notice of surrender or of a revocation notice.

(2) “Reporting period”, in relation to a regulated installation, means—

(a) a scheme year, or

(b) such shorter period for which an emissions report for the installation is required by a notice of surrender or a revocation notice.

Commencement Information

I4 S. 72 in force at 23.7.2020 for specified purposes, see s. 79(1)(a) (as substituted by Finance Act 2020 (c. 14), Sch. 12 para. 8(2))

73 “Emissions allowance” U.K.

[F2 (1)] The “emissions allowance”, in relation to an installation for a reporting period, is the amount of emissions, in tonnes of carbon dioxide equivalent, specified by or under, or determined in accordance with, regulations made by the Commissioners under this section.

[F3 (2) Regulations under this section—

(a) may have effect in relation to the reporting period during which they are made, and

(b) may make provision by reference to data relating to times before they are made.]

Textual Amendments

F2 S. 73(1): s. 73 renumbered as s. 73(1) (22.7.2020) by Finance Act 2020 (c. 14), Sch. 12 para. 2(1)

F3 S. 73(2) inserted (22.7.2020) by Finance Act 2020 (c. 14), Sch. 12 para. 2(2)

Commencement Information

I5 S. 73 in force at 23.7.2020 for specified purposes, see s. 79(1)(a) (as substituted by Finance Act 2020 (c. 14), Sch. 12 para. 8(2))

74 Liability to pay carbon emissions tax U.K.

(1) Carbon emissions tax in relation to an installation is payable by the person who, at the end of the reporting date, holds the permit for the installation.

(2) The “reporting date”, in relation to a reporting period, means the day on which the emissions report for that period is required to be submitted to the regulator under the Emissions Regulations.

Commencement Information

I6 S. 74 in force at 23.7.2020 for specified purposes, see s. 79(1)(a) (as substituted by Finance Act 2020 (c. 14), Sch. 12 para. 8(2))

Administration etc. U.K.

75 Power to make further provision about carbon emissions tax U.K.

(1) The Commissioners may by regulations—

(a) make provision about the assessment, payment, collection and recovery of carbon emissions tax, including provision about the recovery of overpayments;

(b) require persons to keep, for purposes connected with carbon emissions tax, records of specified matters, and to preserve those records for a specified period;

(c) make provision for the review of, and a right of appeal against, specified decisions of HMRC in connection with carbon emissions tax;

(d) make provision about the enforcement of carbon emissions tax [F4 (including provision for the imposition of civil penalties for failure to comply with a requirement of regulations under this Part)] ;

(e) permit or require the sharing of information between HMRC, authorities and regulators for purposes in connection with carbon emissions tax;

(f) make provision about the form, manner and content of any notice, application or other communication with HMRC in connection with carbon emissions tax (including provision about communications in electronic form);

(g) make provision in relation to cases where an individual liable for carbon emissions tax dies or becomes incapacitated, or where a person (whether or not an individual) is subject to an insolvency procedure.

(2) The Commissioners may by regulations make provision for purposes in connection with carbon emissions tax—

(a) about the submission of emissions reports to a regulator;

(b) about emissions determinations, including provision permitting or requiring a regulator to make an emissions determination in specified circumstances;

(c) specifying conditions to be included in a permit granted by a regulator;

(d) for the review of, and a right of appeal against, specified decisions F5 ...;

(e) about the performance of a function of a regulator;

(f) about the form, manner and content of any notice, application or other communication with a regulator (including provision about communications in electronic form).

(3) Regulations under this section may, in particular—

(a) make provision that is equivalent to, or applies with or without modification, any provision of an enactment relating to tax;

[F6 (b) modify—

(i) the Monitoring and Reporting Regulation;

(ii) the Verification Regulation;

(iii) subordinate legislation relating to the monitoring or regulation of emissions.]

Textual Amendments

F4 Words in s. 75(1)(d) inserted (22.7.2020) by Finance Act 2020 (c. 14), Sch. 12 para. 4(2)

F5 Words in s. 75(2)(d) omitted (22.7.2020) by virtue of Finance Act 2020 (c. 14), Sch. 12 para. 4(3)

F6 S. 75(3)(b) substituted (22.7.2020) by Finance Act 2020 (c. 14), Sch. 12 para. 4(4)

Commencement Information

I7 S. 75 in force at 23.7.2020 for specified purposes, see s. 79(1)(a) (as substituted by Finance Act 2020 (c. 14), Sch. 12 para. 8(2))

76 Consequential provision U.K.

(1) In section 1 of the Provisional Collection of Taxes Act 1968 (temporary statutory effect of House of Commons resolutions), in subsection (1), after “petroleum revenue tax” insert “ , carbon emissions tax, ”.

(2) In regulation 52 of the Emissions Regulations (penalty for carrying out a regulated activity without a permit), after paragraph (2) insert—

“(2A) In paragraph (2), the reference to “costs” includes a reference to carbon emissions tax.”

(3) Section 4(1) of the European Union (Withdrawal) Act 2018 does not apply, for the purposes of carbon emissions tax, in relation to any rights, powers, liabilities, obligations, restrictions, remedies and procedures so far as they arise under—

(a) Council Directive 2008/118/EC of 16 December 2008 concerning the general arrangements for excise duty, or

(b) Council Directive 2003/96/EC of 27 October 2003 restructuring the Community framework for the taxation of energy products and electricity.

(4) The Commissioners may by regulations make such provision as they consider appropriate in consequence of this Part.

(5) Regulations under subsection (4) may [F7 modify—

(a) any enactment (whenever passed or made);

(b) the Monitoring and Reporting Regulation;

(c) the Verification Regulation.]

Textual Amendments

F7 Words in s. 76(5) substituted (22.7.2020) by Finance Act 2020 (c. 14), Sch. 12 para. 5

Commencement Information

I8 S. 76 in force at 23.7.2020 for specified purposes, see s. 79(1)(a) (as substituted by Finance Act 2020 (c. 14), Sch. 12 para. 8(2))

General U.K.

77 Interpretation U.K.

(1) In this Part—

• “the Commissioners” means the Commissioners for Her Majesty's Revenue and Customs;

• “emissions allowance” has the meaning given by section 73;

• “emissions determination” has the meaning given by section 71;

• “the Emissions Regulations” means the Greenhouse Gas Emissions Trading Scheme Regulations 2012 (S.I. 2012/3038);

• “emissions report” has the meaning given by section 72;

• “enactment” includes an enactment contained in subordinate legislation within the meaning of the Interpretation Act 1978;

• “HMRC” means Her Majesty's Revenue and Customs;

• “installation” has the meaning given by regulation 3 of the Emissions Regulations (and references to an installation include references to an offshore installation, as defined in those Regulations);

• [F8 “modify” includes amend, repeal or revoke;]

• [F9 “the Monitoring and Reporting Regulation” means Commission Implementing Regulation (EU) 2018/2066 of 19 December 2018 on the monitoring and reporting of greenhouse gas emissions pursuant to Directive 2003/87/EC of the European Parliament and of the Council and amending Commission Regulation (EU) No 601/2012 (as amended from time to time);]

• “operator” has the meaning given by regulation 3 of the Emissions Regulations (as read with Schedule 1 to those Regulations);

• “reporting period” has the meaning given by section 72 F10 ...;

• “specified” means specified in regulations under this Part;

• [F11 “the Verification Regulation” means Commission Implementing Regulation (EU) No 2018/2067 of 19 December 2018 on the verification of data and on the accreditation of verifiers pursuant to Directive 2003/87/EC of the European Parliament and of the Council (as amended from time to time).]

(2) In this Part, the following terms have the meaning given by regulation 3 of the Emissions Regulations—

• “authority”,

• “emissions”,

• “excluded installation”,

• “monitoring and reporting conditions”,

• “monitoring and reporting requirements”,

• “notice of surrender”,

• “permit”,

• “regulator”,

• “revocation notice”,

• “scheme year”, and

• “tonne of carbon dioxide equivalent”.

(3) An “installation” is a “regulated installation” for a reporting period if, at any time during the period, the operator holds a permit for the installation.

[F12 (4) For the purposes of this Part, the Monitoring and Reporting Regulation is to be treated for the purposes of section 3 of the European Union (Withdrawal) Act 2018 as if it is fully in force immediately before IP completion day (even if it is not).]

Textual Amendments

F8 Words in s. 77(1) inserted (22.7.2020) by Finance Act 2020 (c. 14), Sch. 12 para. 7(2)(a)

F9 Words in s. 77(1) substituted (22.7.2020) by Finance Act 2020 (c. 14), Sch. 12 para. 7(2)(b)

F10 Words in s. 77(1) omitted (22.7.2020) by virtue of Finance Act 2020 (c. 14), Sch. 12 para. 7(2)(c)

F11 Words in s. 77(1) substituted (22.7.2020) by Finance Act 2020 (c. 14), Sch. 12 para. 7(2)(d)

F12 S. 77(4) substituted (22.7.2020) by Finance Act 2020 (c. 14), Sch. 12 para. 7(3)

Commencement Information

I9 S. 77 in force at 23.7.2020 for specified purposes, see s. 79(1)(a) (as substituted by Finance Act 2020 (c. 14), Sch. 12 para. 8(2))

78 Regulations U.K.

(1) Regulations under section 73, 75 or 76 may—

(a) make provision conferring functions or discretions on [F13 HMRC, the Secretary of State,] an authority, a regulator or any other person;

(b) impose charges as a means of recovering costs incurred by a person in exercising a function conferred under the regulations [F14 or in anticipation of the conferral of such a function] ;

(c) make provision by reference to matters determined or published by HMRC, the Secretary of State, an authority or a regulator (whether before or after the regulations are made);

(d) make different provision for different purposes;

(e) include incidental, consequential, supplementary, transitional or transitory provision.

(2) Regulations under this Part are to be made by statutory instrument.

[F15 (3) A statutory instrument containing regulations under section 76(4) that make provision amending or repealing any provision of an Act of Parliament must be laid before the House of Commons after being made and, unless approved by that House before the end of the period of 40 days beginning with the date on which the instrument is made, ceases to have effect at the end of that period.]

(4) Any other statutory instrument containing regulations under this Part is subject to annulment in pursuance of a resolution of the House of Commons.

(5) But subsection (4) does not apply to a statutory instrument containing only regulations under section 79 (commencement).

[F16 (6) The fact that a statutory instrument ceases to have effect as a result of subsection (3) does not affect—

(a) anything previously done under the instrument, or

(b) the making of a new instrument.

(7) In calculating the period of 40 days mentioned in subsection (3), no account is to be taken of any time—

(a) during which Parliament is dissolved or prorogued, or

(b) during which the House of Commons is adjourned for more than four days.]

Textual Amendments

F13 Words in s. 78(1)(a) inserted (22.7.2020) by Finance Act 2020 (c. 14), Sch. 12 para. 6(2)(a)

F14 Words in s. 78(1)(b) inserted (22.7.2020) by Finance Act 2020 (c. 14), Sch. 12 para. 6(2)(b)

F15 S. 78(3) substituted (22.7.2020) by Finance Act 2020 (c. 14), Sch. 12 para. 6(3)

F16 S. 78(6)(7) inserted (22.7.2020) by Finance Act 2020 (c. 14), Sch. 12 para. 6(4)

Commencement Information

I10 S. 78 in force at 23.7.2020 for specified purposes, see s. 79(1)(a) (as substituted by Finance Act 2020 (c. 14), Sch. 12 para. 8(2))

79 Commencement and transitional provision U.K.

[F17 (1) This Part comes into force—

(a) for the purposes of making regulations under section 70, 73, 75 or 76, on the day after the day on which paragraphs 1 to 8 of Schedule 12 to FA 2020 come into force, and

(b) for all other purposes, on such day as the Commissioners may by regulations appoint.]

(2) Regulations under subsection (1) may—

(a) appoint different days for different purposes;

(b) include transitional or transitory provision.

F18 (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F18 (4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F18 (5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F17 S. 79(1) substituted (22.7.2020) by Finance Act 2020 (c. 14), Sch. 12 para. 8(2)

F18 S. 79(3)-(5) omitted (22.7.2020) by virtue of Finance Act 2020 (c. 14), Sch. 12 para. 8(3)

Commencement Information

I11 S. 79 in force at 23.7.2020 for specified purposes, see s. 79(1)(a) (as substituted by Finance Act 2020 (c. 14), Sch. 12 para. 8(2))