​​Scottish Landfill Tax: lower rate review​ 

The Scottish Landfill Tax (SLfT), introduced in April 2015, was designed to discourage landfill disposal and encourage prevention, reuse, recycling and energy recovery.  

The tax has two rates. The lower rate of SLfT was designed to provide a low-cost disposal route for inert, low-risk materials, such as rocks and soils.  A higher standard rate targeted more polluting materials to support environmental goals. In early 2024, lower-rate materials exceeded standard-rate materials for the first time.

This research provides an initial evidence base to assess the effectiveness of the lower rate and explore whether changes could better support a low-carbon, circular economy. It examines the most common lower-rate materials, their environmental impacts, the feasibility of diversion and options for policy reform. 

The researchers conducted quantitative and qualitative data analysis, a literature review and stakeholder engagement. 

Findings

Three materials accounted for 77% of all waste landfilled at the lower rate in 2023–24, by weight:  

• mechanically-treated fines (small particles from treatment of general construction and demolition waste, municipal recyclate etc)
• soils and stones from construction waste  
• mechanically-treated mineral fines (small particles from treatment of naturally-occurring materials such as rocks and soils, silt, clay, sand and stones, found in quarry, construction and demolition waste etc) 

Mechanically-treated fines make up the greatest quantities of all lower-rate materials, despite being intended as a residual output from material recovery processes. Trends raise concerns regarding misclassification. 

Environmental impact analysis, based on the quantities landfilled in Scotland, showed that these three materials also have the highest impacts across indicators such as air pollution, water use and resource scarcity.  

This study suggests the lower-rate SLfT may be only partially aligned with Scotland’s current circular economy, waste prevention and climate goals. While it has supported some diversion of inert waste from landfill, it may also be driving unintended behaviours and limiting investment in recovery.

Both fiscal and non-fiscal actions may be needed to address these challenges. The upcoming Scottish Aggregates Tax and wider circular economy policy agenda offer opportunities to align SLfT more closely with long-term environmental objectives. 

For further details, please read the report.

If you require the report in an alternative format, such as a Word document, please contact info@climatexchange.org.uk or 0131 651 4783.

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