Building a greener future

Aggregates Tax Bill to encourage use of recycled materials in construction.

Details of a proposed Scottish tax aiming to encourage the use of recycled materials in construction and other industries have been published.

The proposals form part of the Aggregates Tax and Devolved Taxes Administration (Scotland) Bill, which has been introduced to Parliament.

If approved by MSPs, the Scottish Government intends to introduce the tax from 1 April 2026. It would replace the UK Aggregates Levy, using powers devolved under the Scotland Act 2016, and would tax the sale or use of aggregates consisting of freshly extracted rock, gravel or sand.

The Bill also includes amendments to the Revenue Scotland and Tax Powers Act 2014 to support the efficient and effective collection of tax by Revenue Scotland.

Public Finance Minister Tom Arthur said:

“The new tax proposals have been developed to support the Scottish Government’s ambitions for a fair, green and growing economy, encouraging the use of recycled materials in aggregates across a range of construction-related activities. The tax would be administered by Revenue Scotland, allowing for a modern, effective and Scotland-specific approach.

“In line with our New Deal for Business, this legislation has been informed by extensive engagement with the aggregates industry and others, and I am grateful to our advisory group for their input so far. I look forward to this group’s work continuing as the Bill progresses through Parliament.”


The Aggregates Tax and Devolved Taxes Administration (Scotland) Bill

Scottish Government policy on the aggregates tax

The Scotland Act 2016 provided the Scottish Parliament with the competence to charge tax on the commercial exploitation of aggregate in Scotland. The introduction of the Aggregates Tax and Devolved Taxes Administration (Scotland) Bill delivers a 2023 Programme for Government commitment.

As with other fully devolved taxes, additional secondary legislation and operational work by Revenue Scotland will be required before a new tax would be introduced. The UK Government will also have to introduce legislation to turn off the application of the Aggregates Levy in Scotland. The rate of the Scottish Aggregates Tax will be set as part of the annual Scottish Budget process. 

The Scottish Government has also published a consultation report, which includes an analysis of responses to an earlier consultation, an overview of discussion at the advisory group and a summary of decisions taken in response. 

Breaking New Ground - Developing a Scottish tax to replace the UK Aggregates Levy Consultation Analysis Report


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