HC Deb 16 June 1999 vol 333 c169W
Sir Nicholas Lyell

To ask the Chancellor of the Exchequer what estimate he has made of the percentage by which manufacturing industry's costs would increase as a result of his proposals for a climate change levy, in respect of changes in the cost of(a) electricity, (b) coal and (c) gas. [86771]

Ms Hewitt

The Government believe that all sectors of the economy will need to play their part in helping to meet the legally-binding target for reducing greenhouse gas emissions set under the Kyoto Protocol and our domestic commitment to further reductions. The climate change levy is expected to save around 1.5 million tonnes of carbon a year by 2010, thereby making a significant contribution to meeting the Government's targets for reducing greenhouse gas emissions.

The climate change levy will entail no increase in the burden of tax on business as a whole, since the revenues will be fully recycled to business via a 0.5 percentage point reduction in the main rate of employers' National Insurance Contributions. Business will also benefit from additional £50 million for schemes aimed at promoting energy efficiency and support for renewable sources of energy, such as solar and wind power.

The final incidence of the levy on particular sectors will depend on the rates set for different sectors.

The Government recognise the need for special consideration to be given to energy intensive industries given their high energy usage and exposure to international competition. We intend to set significantly lower rates of tax for energy intensive sectors that agree targets for improving their energy efficiency. Negotiations are currently underway with the main energy intensive sectors.

Mr. Swayne

To ask the Chancellor of the Exchequer what representations he has received from glasshouse growers concerning the proposed climate change levy; and if he will make a statement. [86392]

Ms Hewitt

The Chancellor has received a number of responses from glasshouse growers in the course of the consultation on the climate change levy. These will be considered along with the other responses to the consultation.