Lib Dems blast Labour council over staggering £16.2m landfill tax hit to council tax payers

Following news that Labour-run Cardiff Council now accepts after years of wrangling that it must pay £16.2 million to HMRC for underpaid landfill tax (including interest) for materials placed in 2015 in the former Lamby Way landfill site to cap and restore it at the end of its life, the leader of the council’s official opposition, Liberal Democrat councillor Rodney Berman, said:

“This sorry saga represents a tale of sheer incompetence and secrecy from Cardiff’s Labour-run council. Whilst we have known for some years that the authority was locked in a protracted dispute with HMRC about an alleged underpayment of landfill tax, we weren’t previously made aware this related to materials placed on the tip by the council itself to cap and restore it at the end of its life. Nor were we told where the council had obtained those materials, or just how high in value the disputed underpayment was.

“I am simply flabbergasted to hear that the council clearly wasn’t on top of knowing what it was tipping and what rate of landfill tax it should therefore have been paying in relation to the materials in question.

“Paying out £16.2 million now that wasn’t previously budgeted for will be a massive hit to the council’s finances which it can ill afford – especially at a time when the authority hasn’t been able to give over a third of the city’s schools enough cash to cover running costs, is facing another massive budget deficit in the coming year, and has recently agreed to shell out millions towards the delivery of a new indoor arena. The council is having to get permission from the Welsh Government to borrow much of what it needs to pay, meaning it will potentially have to pay out £2 million a year in debt repayments over the next ten years to pay this borrowing back. That will undoubtedly mean more cuts in key services for Cardiff’s residents.”

Cardiff Liberal Democrats are also querying the role of Neil Soil Suppliers Ltd, a company established by David Neal which supplied the soil for which the council is now having to pay underpaid landfill tax. David Neal was involved in the recent downfall of former Labour First Minister, Vaughan Gething, as the man who provided him with the £200,000 donation towards his leadership campaign despite having been convicted of environmental crimes dating back many years.

Councillor Berman added: “As has been reported in the media, David Neal’s group of companies has been under investigation for allegedly ‘mischaracterising’ categories of waste in order to minimise the payment of landfill tax – the same thing that Cardiff Council is now accepting it has done. Their role in what has happened at Lamby Way clearly needs to be explained.

“We must now have a full and open enquiry into what went wrong and why the Labour-run council has blundered in such a spectacular way.”

ENDS