Industry lines up for fight over climate levy

The CBI is warning that the government is in for a battle over the proposed Climate Change Levy unless the rate is reduced or the concessions are increased.

To meet promised cuts in greenhouse gas emissions, the Chancellor has suggested a tax rate of between 8% - 14% on energy consumption, due to come into effect in April 2001. Heavy energy users are negotiating now about the level of discount they will receive.

But the CBI is unhappy with the state of consultation, fearing that the levy's impact on UK business will be more serious than the government anticipates.

A recent study from the World Wide Fund for Nature - reported here on 30 September - projects that the tax will actually be beneficial for both the economy and the environment.

Elliott Chase