HC Deb 10 November 1999 vol 337 cc643-4W
Mr. Gardiner

To ask the Chancellor of the Exchequer if he will assess the advantages and disadvantages of rebating part of the climate change levy for energy-intensive industries. [97708]

Mr. Timms

Our aim has been to design the climate change levy in a way that maximises its environmental effectiveness whilst protecting competitiveness of UK firms. As indicated in the Pre-Budget Report, by increasing the environmental effectiveness of the levy, it has been possible to deliver bigger carbon savings whilst reducing the overall size of the levy from £1.75 billion to £1 billion. The Government is also offering an 80 per cent. discount from the levy for those energy-intensive sectors signing energy efficiency agreements which meet the Government's criteria. This discount will help protect the competitiveness of the industries concerned, whilst ensuring that all firms face some incentive to save energy at the margin. The carbon savings arising from the negotiated agreements will also make a significant contribution to meeting the Government's legally binding Kyoto target for reducing greenhouse gas emissions.

Mr. Gardiner

To ask the Chancellor of the Exchequer if he will assess the advantages and disadvantages of exempting key industrial processes from the climate change levy, with particular reference to blast furnaces and electrolysis. [97706]

Mr. Timms

I refer my hon. Friend to the Pre-Budget Report issued by the Chancellor of the Exchequer on 9 November 1999,Official Report, columns 883-906, which sets out the Government's policy in respect of the exemption from Climate Change Levy on both electrolysis and coke used in blast furnaces.

Contributions to and receipts from the EC Budget in 1997
Gross contribution (£ million) Receipts (£ million) Net contribution/receipt 1 (£ million) Population (millions) Number of households (millions) Gross contribution per head (£)
Belgium 2,047.8 1,365.7 682.1 10.2 4.0 200.9
Denmark 1,037.8 1,054.3 -16.5 5.2 2.3 197.8
Germany 14,622.5 6,884.4 7,738.2 82.1 35.2 178.1

Mrs. Brinton

To ask the Chancellor of the Exchequer if he intends the climate change levy on liquified petroleum gas to be fully balanced by excise duties on hydrocarbon oils. [96898]

Mr. Timms

The rate of excise duty on fuel oil and gas oil is already higher than the illustrative rates of climate change levy shown in the Customs and Excise consultation document issued on 9 March.

Mrs. Brinton

To ask the Chancellor of the Exchequer for what reasons he intends to exempt kerosene from the climate change levy. [96897]

Mr. Timms

Climate change levy is not being charged on kerosene or other hydrocarbon oils because they are already within the scope of an existing taxation regime. In the existing regime, however, kerosene is charged at a nil rate because it is heavily used in central heating systems by domestic consumers. For social policy reasons, the Government has made it clear that it does not wish to increase taxation on domestic fuels.