Treasury to rethink energy levy

Evidence has emerged that the Government is ready to rethink its controversial plans for an energy tax on business, in the wake of widespread criticism. Peter Agar, deputy director-general at the Confederation of British Industry, said last week his organisation was confident that the Government had accepted industry arguments that the tax as proposed would […]

Evidence has emerged that the Government is ready to rethink its controversial plans for an energy tax on business, in the wake of widespread criticism.

Peter Agar, deputy director-general at the Confederation of British Industry, said last week his organisation was confident that the Government had accepted industry arguments that the tax as proposed would damage UK competitiveness.

The proposals – which would tax energy consumption not greenhouse gas emissions – were attacked as `deeply flawed’ in the Royal Society and Royal Academy of Engineering report on the nuclear industry’s future, published this week.

The Treasury is likely to oppose big changes, but may look at a greater role for negotiated agreements with the various industrial sectors.

The Combined Heat and Power Association said such agreements had a `vital role’ and could transform the UK industry into one of the five most energy efficient in the world within 10 years.