Chapter 3 – Calculation of tax
Amount of tax
Section 11: Weight of aggregate
46.This section gives a regulation-making power to the Scottish Ministers to make provision about determining the weight of any aggregate for the purposes of calculating the tax. These regulations are subject to the affirmative procedure.
47.The regulations may specify rules for determining the weight directly, authorise rules for determining the weight to be specified by Revenue Scotland, or authorise rules for determining the weight to be agreed between taxpayers and a person designated by Revenue Scotland. Such rules may concern the method by which the weight is to be determined, the time by reference to which the weight is to be determined, and the discounting of constituent ingredients from the calculation of weight. The rules may be provided for as only applying in certain cases or on certain conditions.
Section 12: Rate of tax
48.Subsection (1) of this section provides that the amount of tax charged on taxable aggregate is calculated by multiplying the applicable rate of tax by the weight in tonnes of the taxable aggregate. Then subsection (2) clarifies that where a quantity of taxable aggregate weighs only part of a tonne, the amount of tax charged is to be reduced in proportion to the weight.
49.Under subsection (3), the Scottish Ministers may make regulations specifying the applicable rate (or rates) of tax for the purposes of this section. Under section 61(2) of the Act, these regulations are subject to what is known as the “provisional affirmative” or “made affirmative” procedure whereby the regulations are made by the Scottish Ministers, and therefore have effect from when they are made, but must be laid before the Scottish Parliament and will cease to have effect after 28 days unless they are approved by resolution of the Parliament.
Repayments
Section 13: Repayments of overpaid tax
50.This section of the Act amends section 108 of the 2014 Act, which relates to situations where subordinate legislation intended to change the tax basis of a devolved tax by means of the provisional affirmative procedure applies for a period but is not subsequently approved by the Scottish Parliament within 28 days of it being laid.
51.When such an instrument is made, the changes to the tax basis set out in it (which in the case of regulations under section 12 of the Act might be changes to the tax rate for aggregates tax) can apply immediately, so taxpayers’ liability will change as soon as the instrument is made: but if the proposed changes are not approved by Parliament within 28 days, then the instrument falls. Section 13 of the Act amends section 108 so that in such a situation, a taxpayer can make a claim for repayment of the amount of additional aggregates tax paid during the period when the instrument was in force.
52.The section also changes references to “order” to references to “instrument”, reflecting that regulations are the preferred form of statutory instrument in modern drafting practice.
53.Subsection (2) of section 108 allows a taxpayer to make a claim to Revenue Scotland for the amount of additional tax paid because of the instrument that fell, and any related penalty or interest. Subsection (5) provides that any claim must be made within two years of the “relevant date” which is defined in subsection (6).
Section 14: Adjustment of contracts
54.Where a contract to supply aggregate has been entered into, and there is a change to the amount of tax chargeable in relation to the supply of the aggregate referred to in the contract, this section provides that the amount of payment due in return for the aggregate is to be adjusted so that the cost of the tax, to the extent that it would otherwise have been borne by the supplier, is borne instead by the person paying for the aggregate. However the parties to the contract can agree to disapply this rule.
Credits
Section 15: Tax credits
55.This section gives a regulation-making power, subject to the negative procedure, for the Scottish Ministers to create tax credits in relation to the payment of Scottish aggregates tax. Such tax credits would be offset against a taxpayer’s liability to pay the tax: this section creates several categories of tax credit for the purposes of Scottish aggregates tax.
56.As per subsection (3), the regulations creating tax credits may include cases where any quantity of taxable aggregate is moved outwith Scotland to a place in the rest of the UK, or to UK waters. As per subsection (4), they may also include cases where any quantity of taxable aggregate is exported outwith the UK from a place in Scotland.
57.As per subsection (5), the regulations may include cases where any quantity of taxable aggregate has an excepted process applied to it – a term defined in section 4 of the Act. As per subsection (6) they may also include cases where any quantity of taxable aggregate is used in an industrial or agricultural process set out in the regulations. As per subsection (7) they may include provision cases where any quantity of taxable aggregate is disposed of (by dumping or otherwise) for purposes unrelated to construction.
58.In addition, as per subsection (8), the regulations may include cases where the whole or part of a debt which is due to the person liable to pay the tax is written off in the person’s accounts as a bad debt, as defined in the regulations.
Section 16: Tax credits: further provision
59.This section makes further and general provision about the regulation-making power to create tax credits conferred on the Scottish Ministers by section 15.
60.This includes that regulations under section 15(1) may make provision as to how to make an application to claim tax credit, and that payment of credit can be made subject to such conditions as Revenue Scotland considers appropriate (see subsection (4)). In addition the regulations may provide that where a tax credit is due to a taxpayer who has previously failed to submit tax returns, Revenue Scotland may withhold payment of the credit until the taxpayer has complied with that requirement to submit a return (see subsection (2)).
