Budget dents purchasing heads' levy rebate hopes

15 March 2001
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15 March 2001 | Liam O'Brien

The budget left corporate procurement directors with little hope that the government will ease the burden of the impending climate change levy.

Business leaders had hoped that Gordon Brown, chancellor of the exchequer, would back up private assurances from the Treasury of a more flexible approach to companies satisfying requirements for rebates of up to 80 per cent of levy costs.

"In other words, it's hard luck, and you have to do it," said Roy Ayliffe, CIPS's director of professional practice.

The controversial levy, due to take effect on 1 April, is expected to raise corporate energy costs by between 10 and 15 per cent. The sector hardest hit will be manufacturing, in particular chemicals and steel companies.

However, Brown had said that tax breaks would be offered later this year under a so-called green technology challenge, which would offer 100 per cent tax relief to companies purchasing energy-efficient machinery and technologies.

But purchasers are angry that the government has yet to publish its promised list of the products, including motors, pipe insulation, boilers, refrigeration and lighting, eligible for tax relief.

SMmar2001

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