Legalize / United Kingdom / Scotland / Act of the Scottish Parliament

Aggregates Tax and Devolved Taxes Administration (Scotland) Act 2024

Type Act of the Scottish Parliament

Publication 2024-11-12

State In force

Jurisdiction Scotland

Department Statute Law Database

Source legislation.gov.uk

Reform history JSON API

Part 1 — Scottish aggregates tax

Chapter 1 — The tax

The tax

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(1) A tax (to be known as Scottish aggregates tax) is to be charged on aggregate when it is subjected to commercial exploitation in Scotland.

(2) Revenue Scotland is responsible for the collection and management of the tax.

Overview of Part 1

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(1) This Part is arranged as follows.

(2) This Chapter establishes Scottish aggregates tax and provides an overview of Part 1 of the Act.

(3) Chapter 2 contains provisions about the key concepts underlying the tax, including—

(a) which aggregate is taxable,

(b) which aggregate is exempt from the tax,

(d) who is liable to pay the tax.

(4) Chapter 3 contains provisions about the calculation of the tax, including—

(a) how the tax is calculated, and

(b) when credit is available in relation to the tax.

(5) Chapter 4 contains provisions about the administration of the tax.

(6) Chapter 5 contains provisions about penalties in relation to the tax.

(7) Chapter 6 contains provisions about reviews and appeals of decisions by Revenue Scotland in relation to the tax.

(8) Chapter 7 contains provisions about interpretation.

Chapter 2 — Key concepts

Meaning of “aggregate”

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In this Part “aggregate” means (subject to section 4) any rock, gravel or sand, together with whatever substances—

(a) are for the time being incorporated in the rock, gravel or sand, or

(b) naturally occur mixed with it.

Excepted processes

4

(1) In this Part references to aggregate—

(a) include references to the spoil, waste, off-cuts and other by-products resulting from the application of any excepted process to any aggregate, but

(b) do not include references to anything else resulting from the application of any excepted process to any aggregate.

(2) In this Part “excepted process” means—

(a) the cutting of any rock to produce stone with one or more flat surfaces,

(b) any process by which a relevant substance is extracted or otherwise separated (whether as part of the process of winning it from any land or otherwise) from any aggregate,

(c) any process for the production of lime or cement from limestone (which for the purposes of this paragraph includes chalk and dolomite) or from limestone and anything else,

(d) in the case of aggregate consisting of shale, any process consisting of a use of the shale that—

(i) is not a use of it as material or support in the construction or improvement of any structure, and

(ii) is not mixing it with anything as part of the process of producing mortar, concrete, tarmacadam, coated roadstone or any similar construction material.

(3) In subsection (2)(b), “relevant substance” means any of the following—

(a) anhydrite,

(b) ball clay,

(d) china clay,

(e) feldspar,

(f) fireclay,

(g) fluorspar,

(h) fuller’s earth,

(i) gems and semi-precious stones,

(j) gypsum,

(k) any metal or the ore of any metal,

(l) muscovite,

(m) perlite,

(n) potash,

(o) pumice,

(p) rock phosphates,

(q) sodium chloride,

(r) talc,

(s) vermiculite.

(4) The Scottish Ministers may by regulations add a substance to, or remove a substance from, the list in subsection (3).

Taxable and exempt aggregate

Taxable aggregate

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(1) Tax is to be charged only on taxable aggregate.

(2) In this Part a quantity of aggregate is taxable aggregate on any occasion that it is subjected to commercial exploitation, except to the extent that it is exempt aggregate under section 6.

Exempt aggregate

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(1) A quantity of aggregate is exempt aggregate to the extent that it falls within subsections (2) to (8) of this section.

(2) Aggregate is exempt under this subsection if it is, or derives from, any aggregate that has already been subjected to a charge to tax.

(3) Aggregate is exempt under this subsection if it has previously been used for construction purposes (whether before or after the date on which this section comes into force).

(4) Aggregate is exempt under this subsection if it is aggregate that, on the date on which this section comes into force, is on a site other than—

(a) its originating site, or

(b) a site that is required to be registered under section 18 under the name of a person who is the operator, or one of the operators, of that originating site.

(5) Aggregate is exempt under this subsection if it consists wholly of aggregate won by being removed from the ground on the site of any structure or any proposed structure, or the site of any infrastructure or any proposed infrastructure relating to transportation or utilities, in the course of excavations lawfully carried out—

(a) in connection with, and necessary for, the construction, modification, maintenance or improvement of the structure or infrastructure, and

(b) not for the purpose of extracting that aggregate.

(6) Aggregate is exempt under this subsection if it consists wholly of aggregate won—

(a) by being removed from the bed of any river, canal or watercourse (whether natural or artificial) or of any channel in or approach to any port or harbour (whether natural or artificial), and

(b) in the course of the carrying out of any dredging undertaken exclusively for the purpose of creating, restoring, improving or maintaining that river, canal, watercourse, channel or approach.

(7) Aggregate is exempt under this subsection if it consists wholly of the spoil from any process by which—

(a) coal (including bituminous coal, cannel coal and anthracite),

(b) lignite,

(d) a substance listed in section 4 (3),

has been separated from other rock after being extracted or won with that other rock.

(8) Aggregate is exempt under this subsection if it consists wholly or mainly of any one or more of the following, or is part of anything consisting wholly or mainly of the following—

(a) coal (including bituminous coal, cannel coal and anthracite),

(b) lignite,

(d) the spoil or waste from, or other by-products of—

(i) any industrial combustion process, or

(ii) the smelting or refining of metal,

(e) the drill-cuttings resulting from any operations carried out in accordance with a licence granted under the Petroleum Act 1998 or the Petroleum (Production) Act (Northern Ireland) 1964,

(f) clay, soil or vegetable or other organic matter.

(9) For the purposes of subsection (2), aggregate has already been subjected to a charge to tax if and only if—

(a) there has been a previous occasion on which a charge to tax on that aggregate has arisen and at least some of the tax previously charged on that aggregate is either—

(i) tax in respect of which there is or was no entitlement to a tax credit, or

(ii) tax in respect of which any entitlement to a tax credit is or was an entitlement to a tax credit of an amount less than the amount of the tax charged on it, or

(b) before the date on which this section comes into force, there has been an occasion on which a charge to aggregates levy on that aggregate has arisen under the Finance Act 2001.

(10) An entitlement to tax credit which arises where a quantity of aggregate is used in an industrial or agricultural process specified in regulations by virtue of section 15 (6) is to be disregarded for the purposes of paragraph (a) of subsection (9) (and therefore for the purposes of that paragraph no entitlement to a tax credit has arisen).

Commercial exploitation of aggregate

Commercial exploitation

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(1) In this Part a quantity of aggregate is subjected to exploitation if and only if—

(a) it is removed from a site falling within subsection (2),

(b) it becomes the subject of an agreement to supply it to any person,

(d) it is mixed, otherwise than in permitted circumstances, with any material or substance (other than water).

(2) The sites which fall within this subsection are—

(a) the originating site of the aggregate,

(b) any site which is not the originating site of the aggregate but is registered under the name of a person under whose name the originating site is also registered,

(c) any site not falling within paragraph (a) or (b) to which the quantity of aggregate had been removed for the purpose of having an excepted process applied to it on that site, but at which no such process has been applied to it.

(3) In this Part a quantity of aggregate is subjected to commercial exploitation if and only if its exploitation is carried out in the course or furtherance of a business carried on by a person responsible for subjecting it to exploitation (and for the purposes of this subsection “business” includes any activity of the Scottish Administration, a Minister of the Crown, local authority or charity).

(4) But a quantity of aggregate is not subjected to commercial exploitation if its exploitation—

(a) consists in the removal of aggregate from one registered site to another, where both sites are registered under the name of the same person,

(b) consists in or requires the removal of aggregate to a registered site for the purpose of having an excepted process applied to it on that site,

(c) consists in or requires the removal of aggregate to any site for the purpose of having china clay or ball clay extracted or otherwise separated from it on that site, or

(d) has the result that—

(i) without it being subjected to any process involving it being mixed with any other substance or material (other than water), and

(ii) by virtue of it being used for a purpose connected with winning aggregate or other minerals from that site,

it again becomes part of the land at the site from which it was won.

(5) For the purposes of subsection (1)(b), the time when a quantity of aggregate becomes the subject of an agreement to supply it to any person is—

(a) when the agreement is entered into, or

(b) in a case where the quantity of aggregate is not separately identifiable when the agreement is entered into, the time when it is appropriated to the agreement.

(6) But references in this Part to the supply of a quantity of aggregate do not include references to any supply which is effected, or is to be effected, by the transfer or creation of any interest or right in or over land.

(7) For the purposes of this Part, a quantity of aggregate is mixed with any material or substance in permitted circumstances if—

(a) the material or substance with which it is mixed consists wholly of a quantity of taxable aggregate that has not previously been subjected to commercial exploitation in Scotland, and

(b) the mixing takes place on a site which, in a case where it falls within subsection (2) in relation to any part of the aggregate included in the mixture, falls within subsection (2) in relation to every part of it.

(8) For the purposes of this Part, the commercial exploitation of a quantity of aggregate is taken to occur in Scotland if—

(a) the aggregate is in Scotland at the time when it is subjected to exploitation, or

(b) subsection (9) applies.

(9) This subsection applies where a quantity of aggregate is subjected to exploitation under subsection (1)(a) or (b) as a result of the movement of aggregate to Scotland from a place in the rest of the United Kingdom or from United Kingdom waters.

(9A) But the exploitation is not to be taken to occur in Scotland if the quantity of aggregate is, or derives from, any aggregate in respect of which—

(a) there has been a previous occasion on which a charge to aggregates levy on that aggregate has arisen under the Finance Act 2001, and

(b) at least some of the aggregates levy previously charged on that aggregate is either—

(i) aggregates levy in respect of which there is or was no entitlement to a tax credit, or

(ii) aggregates levy in respect of which any entitlement to a tax credit is or was an entitlement to a tax credit of an amount less than the amount of the aggregates levy charged on it.

(10) The Scottish Ministers may by regulations modify this Part so as to make further provision about the circumstances in which the exploitation of a quantity of aggregate is taken to occur in Scotland for the purposes of subsection (8).

(11) Subsection (12) applies where, at the time when any aggregate is won from any site, a person (“P”) is in occupation of that site, or both that site and other land, for the purposes of—

(a) the carrying on of any agricultural business, or

(b) the carrying on of any forestry business, or otherwise for the purposes of forestry.

(12) Where this subsection applies, subsection (4)(d) has effect as if—

(a) (where relevant) the reference to the land at the site from which the aggregate was won included P’s other land, and

(b) the words “by virtue of it being used for a purpose connected with winning aggregate or other minerals from that site” were omitted.

Persons liable to pay tax

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(1) The persons liable to pay the tax charged on a quantity of taxable aggregate are the persons responsible for subjecting it to commercial exploitation.

(2) For the purposes of subsection (1), the persons responsible are each of the following—

(a) in a case of the commercial exploitation of a quantity of aggregate by its removal from its originating site or from a connected site, the operator of that site,

(b) in a case of the commercial exploitation of a quantity of aggregate by its removal from a site falling within section 7 (2)(c), the operator of the site and (if different) the owner of the aggregate at the time when the removal takes place,

(c) in a case of the commercial exploitation of a quantity of aggregate at a time when it is not on its originating site or a connected site—

(i) by its becoming the subject of any agreement to supply it, or

(ii) by its being used at such a time for construction purposes,

the person agreeing to supply it or using it for construction purposes,

(d) in a case of the commercial exploitation of a quantity of aggregate at a time when it is on its originating site or a connected site—

(i) by its becoming the subject of any agreement to supply it, or

(ii) by its being used at such a time for construction purposes,

the person mentioned in paragraph (c) and (if different) the operator of that site,

(e) in a case of the commercial exploitation of a quantity of aggregate by its being mixed with any material or substance at its originating site or a connected site, the owner of the aggregate at the time when the mixing takes place and (if different) the operator of the site,

(f) in a case of the commercial exploitation of a quantity of aggregate by its being mixed with any material or substance at premises that are not comprised in its originating site or a connected site, the owner of the aggregate at the time when the mixing takes place and the occupier of the premises where it takes place.

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