Singleton Birch Limited & Anor v The Commissioners for HMRC

For the reduced landfill-tax rate, material disposed of must consist entirely of the specified qualifying material. The inquiry focuses on the waste and the reactions producing it, not merely on whether the process involved some qualifying reaction. Environmental policy and consultation materials cannot modify clear statutory words or add an “essence of the process” or “only purpose” test. Minimal impurities and water may remain within a calcium based reaction waste where they are unavoidable and necessary features of the reaction. Substantial non-reactive or non-calcium material prevents the waste from consisting entirely of that qualifying material.

Singleton Birch Limited operated a landfill site, and FCC Recycling (UK) Limited produced and sent waste to it. The waste was made by mixing acidic ferrous chloride waste from titanium dioxide production with alkaline air pollution control residue. The appellants claimed the reduced landfill-tax rate under section 42(2) of the Finance Act 1996, relying on Note 9(a) in the Schedule to the Landfill Tax (Qualifying Material) Order 2011.

The FTT dismissed the appeals, holding that the FCC Waste was not entirely calcium based reaction waste from titanium dioxide production. The Upper Tribunal considered whether the FTT had applied the correct statutory test and whether the FCC Waste satisfied it.

1. Disposition. The FTT applied an erroneous test. Its decision was set aside. The Upper Tribunal re-made the decision on the FTT’s findings of fact and dismissed the appeals against the assessment.
2. Construction. Section 42(2) and Note 9(a) require the material disposed of to consist entirely of calcium based reaction waste from titanium dioxide production. External materials may assist in identifying purpose and context, but cannot rewrite clear statutory language.
3. Erroneous gloss. The FTT erred by asking whether the “essence” or “only purpose” of the process was to neutralise ferrous chloride with calcium-based material. The statutory test focuses on the reactions producing the waste. It does not exclude qualifying waste merely because the process has another purpose or environmental benefit.
4. Application. The FCC Waste did not qualify. At least 70% of the APCR did not react; the reactive material included significant non-calcium compounds; and 57% to 72% of the FCC Waste was neither reaction waste nor derived from titanium dioxide production.
5. Comparison. Minimal impurities and water in the Cristal Waste were unavoidable or necessary features of the calcium-based reaction and did not prevent it being qualifying material. The FCC Waste was materially different because substantial APCR material was neither reactive nor necessary to the calcium-based reaction.

• Upper Tribunal (Tax and Chancery Chamber) — set aside the FTT’s decision for error of law, re-made the decision on the findings of fact, and dismissed the appeals against the assessment.
• First-tier Tribunal (Tax Chamber) — decision released 11 July 2023; dismissed both appeals against the landfill-tax assessment.