Commenting on the consultation, Allan Wilen, Economics Director said: “At present Land Remediation Relief (LRR) is effectively only available to developers and contractors, not to existing landowners.  It has therefore had a limited impact upon the supply of brownfield sites available for development.  This is reflected in the modest cost to the Treasury, averaging around £12m a year. 

“We believe that the limited take-up of the LRR in large part reflects the significant risks and uncertainties faced by a third party in acquiring contaminated sites and undertaking remedial work.”

The Construction Products Association has warned against the Government’s proposal to link eligibility for LRR to planning permission subsequently being granted.  The Association has proposed that extended eligibility be granted to unincorporated businesses, and relief for early stage professional fees should be included.  These reforms would help improve performance of LRR and increase the uptake of the relief.

 The Association has also suggested that owners of brownfield sites should be able to offset the upfront cost of cleaning up contaminated sites against their Corporation Tax liability.  The Association believes this would significantly improve the supply of brownfield land available for development, and potentially cost the Treasury less per hectare than currently occurs under the LRR regime.

 On the Government’s further proposal to remove the landfill tax exemption, Wilen commented: “This could significantly undermine the commercial viability of redevelopment plans for those sites where ‘dig and dump’ remains the most practical option.

“We urge Government to commission a study of those sites currently claiming the Landfill Tax exemption. The objective would be to assess more effectively the potential impact that landfill tax liability would have on a project’s commercial viability, how readily alternative forms of remediation could be adopted for such sites and the impact upon the overall supply of brownfield development land.”