Small businesses victim to green taxes

UK Small businesses that fail to register their energy use will be hit with significant fines, the Government proclaims.

Under the Governments new ‘green tax’ scheme, thousands of small businesses will be liable to pay hefty fines and charges unless they take part in the scheme.

Many companies must register their energy use by the end of September. From April 2011, firms must buy permits for each tonne of carbon dioxide emitted, which could mean £38,000 for some.

Missing next month’s deadline for registering will be an immediate £5,000 fine and £500 for each day afterwards.

The scheme is intended to create a financial incentive to cut energy use, and those organisations that record the biggest reductions will get bonuses, funded by penalties imposed on those with the worst record.

Those that do participate in the Carbon Reduction Commitment (CRC) initiative by declaring their energy use will face charges for every ton of greenhouse gas they produce.

A recent survey showed that thousands of businesses are unaware they are supposed to be taking part in the scheme. The same number of companies was unaware that the tax scheme exists at all.

Many small businesses are concerned that the imposition of new charges and fines will put further pressure on firms. Especially at a time when economists are warning of a double dip in recession.

Business leaders criticised the CRC as complex and bureaucratic. One said that ministers swung a big hammer at companies with this scheme, and questions whether it would actually have any environmental benefits.