Plans to reform carbon reporting and the taxation regime for UK businesses have been unveiled.
The Treasury has launched a consultation and set out proposals to simplify and move away from overlapping policies towards one where businesses would face just one tax and one reporting scheme.
It is seeking responses from businesses, representative bodies and third sector organisations in a bid to boost investment in energy efficiency by streamlining carbon reporting.
It follows concerns from businesses and environmental groups around the complexity of the current energy efficiency landscape and the impact it has on administrative burdens.
Currently some businesses have to comply with two energy tax schemes – the Carbon Reduction Commitment (CRC) and Climate Change Levy (CCL) – and carbon reporting schemes through schemes including the CRC and Energy Savings Opportunity Scheme (ESOS).
The government proposes replacing the CRC and CCL with a new energy consumption tax based on the CCL and is “open to considering options” for incentives for energy efficiency.
The review has three key aims of “boosting business productivity, supporting growth and decarbonising the economy”.
Damian Hinds, Exchequer Secretary to the Treasury said: “This government wants to create a sustainable tax system for businesses that is fair and simple and supports growth. We recognise business concerns around the complexity of business energy efficiency policy and we want to create a simpler and more stable environment.
“This will in turn help increase the productivity of our businesses and boost our economy, while at the same time delivering on our commitment to save carbon.”