AN OUT-OF-COURT deal has been reached to resolve a tax dispute over the use of a landfill site in Alexandria.
Revenue Scotland had told Barr Environmental to pay unpaid tax and penalties in July 2018 over unpaid Scottish Landfill Tax (SLT).
Barr had been found to be using materials at its Auchencarroch landfill site, and at a second facility at Garlaff near Cumnock, that should have been classed as waste.
A First Tier Tax Tribunal initially refused the company’s appeal against the ruling, saying the company was liable for a £99.6 million bill in unpaid taxes and fines.
However, the company then appealed to the Upper Tribunal for Scotland – which overturned the First Tier’s decision.
Now it can be revealed that Barr and Revenue Scotland have reached an out-of-court settlement to resolve the dispute. But both said it was a private matter.
West Dunbartonshire Council, at the time of the tax tribunal decision, projected the cost to the firm could lead to £750,000 over two years in added expense for taxpayers.
Council officials told the Reporter that they have set aside money in case any cost of the deal is passed on.
A spokesperson said: “The council has a financial contingency in place and we await the outcome of the settlement.”
A spokesman for the Scottish Courts and Tribunal Service confirmed: “We have been advised that parties Barr Environmental Ltd and Revenue Scotland have agreed to settle matters in dispute in the lead appeal.“
The parties have also settled the follower appeals and they have been withdrawn.”
Despite the public decision in the 2021 case, Revenue Scotland said it could not comment as it had a legal obligation to “protect taxpayer information”.
The original tribunal rueld that over more than two and a half years, Barr was able to offer a cheaper rate for landfill services than their competitors, helping them win council contracts between April 1, 2015 and December 31, 2017.
But in a judgement published last May, Lord Ericht said the First Tier Tribunal had “erred” by failing to take into account that saving landfill tax by using recycled materials “fulfils the objective of the tax”.
“Instead, the Tribunal proceeded on the basis that there was something inherently wrong with reducing tax by using recycled materials,” he said.
A Barr Environmental spokesperson said: “Barr Environmental and Revenue Scotland have reached a confidential out-of-court agreement in relation to a case about Scottish Landfill Tax.
“We welcome the agreement and remain focused on providing the best waste management solutions to our clients moving forward.”
The case hinged on how Barr used material that should have been designated for the landfill for “engineering works” for construction and development of the landfill.
Barr said it was following the advice of accountants KPMG.
Thousands of pages were submitted in evidence on the case, related to hundreds of thousands of tonnes of waste.
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