Scottish Aggregates Tax (Miscellaneous Amendments) Regulations 2026: business and regulatory impact assessment

Section 2: Consultation

SAT expert advisory group

The Scottish Government engaged with the SAT expert advisory group to explore the views of members on proposed approaches to cross-border taxation.

Established in January 2023, the advisory group informed the development of the 2024 Act and continues to provide expertise on preparation for the implementation of SAT.

Advisory group members are drawn from a range of backgrounds, including industry representative bodies for both primary and recycled aggregate producers, aggregates consumers (including key public sector bodies), corporate stakeholders with an interest, and environmental organisations.

In particular, the SAT expert advisory group includes spokespeople from trade bodies representing companies which produce the majority volume of primary and recycled aggregate in Scotland.

These are:

• The British Aggregates Association, a trade body for independent small and medium size quarry operators.
• The Mineral Products Association, a trade association for the aggregates, asphalt, cement, concrete, dimension stone, lime, mortar, and industrial sand industries.
• Resource Management Association Scotland, a trade body for micro, small and medium sized resource management companies.

Revenue Scotland engagement to date has focussed on the development of the registration process, the tax return, and guidance. Input has been received from representatives of the British Aggregates Association, Mineral Products Association, Chartered Institute of Taxation, Institute of Chartered Accountants of Scotland, the British Geological Survey, and individual businesses (both those represented by trade bodies and those outside them). This engagement has helped Revenue Scotland develop the registration process, tax return, and technical guidance. Further engagement is planned with future SAT taxpayers, including onboarding sessions in order to ensure that these processes are well understood prior to SAT coming into operation on 1 April 2026.

Public Consultation

The Scottish Government launched a public consultation^[6] in June 2025 to gather views on the proposed approaches to cross-border taxation. The consultation ran for 8 weeks and the analysis report^[7] was published on the Scottish Government website.

Views were sought on two particular scenarios, which represent a small subset of overall cross-border transactions. These are:

• movement of aggregate into Scotland from the rest of the UK (rUK) where there are multiple links in a supply chain; and
• where aggregate is collected from a current rUK taxpayer and transported to Scotland for commercial exploitation.
• Respondents were also invited to raise other potential cross-border issues that might arise and offer views on the operation of SAT.

As part of evidence gathering for this BRIA, the consultation sought views on a range of impact assessments, including impacts on businesses and consumers.

The consultation was published on Citizen Space and on the Scottish Government website. Officials engaged with industry bodies and wider stakeholders to promote awareness of the consultation with the aggregates industry.

Prior to the consultation, the Scottish Government, in collaboration with Revenue Scotland and HM Revenue and Customs (HMRC), engaged with industry representative bodies and wider stakeholders to help shape the options under consideration. The comments and feedback received during this engagement helped shape the proposals in the consultation. These planned approaches remain unchanged following the consultation.

Engagement

Internal Scottish Government Engagement

Tax Division has a network of stakeholder organisations with an interest in tax policy. Government organisations and departments with a policy interest in proposals are contacted in respect of these proposals and consultation documents are made available to these bodies.

This includes direct contact and discussion with Revenue Scotland during the development phase.

UK/Devolved Administrations Engagement

Although policy for SAT and AGL are the responsibility of the Scottish Government and UK Government, respectively, both Governments have worked collaboratively to explore complementary approaches to cross-border taxation.

The Scottish Government and HMRC have worked closely to consider the approaches to cross-border taxation. This work has included joint engagement with various aggregate industry businesses and stakeholders to inform the consultation.

There is a joint aim to develop cross-border tax options that:

• avoid double taxation of aggregate;
• minimise the risk of market distortion (should the respective tax rates vary in future);
• minimise the risk of tax avoidance or evasion;
• enable Revenue Scotland and HMRC to assure compliance; and
• are workable and proportionate for business.

Wider Engagement – Public, professional and third sector bodies

Scottish Government officials have engaged with representatives from the following organisations, all of whom have members on the SAT expert advisory group:

• Institute of Chartered Accountants of Scotland (ICAS);
• Chartered Institute of Taxation (CIOT);
• Convention of Scottish Local Authorities (COSLA);
• Resource Management Association Scotland (RMAS); and
• Scottish Environment Protection Agency (SEPA).

The remit of the advisory group is to provide expert advice, challenge, and scrutiny of policy positions, with the aim of ensuring that the design of the SAT is compatible with its intended outcomes and meets the needs of industry and other stakeholders. The expert advisory group also works to identify and offer solutions to any potential adverse impacts and unintended consequences that may arise from the introduction of SAT.

Business and Industry Engagement

As these cross-border regulations are most relevant to businesses who will be SAT taxpayers, business engagement has been a crucial component of policy development.

The aim has been to develop a pragmatic approach to cross-border taxation that minimises administrative burdens on taxpayers and ensures that taxpayers are not subject to tax on the same taxable activity in both jurisdictions. Additionally, the Scottish Government is committed to minimising market distortions - particularly for businesses near the border - and to preventing opportunities for tax avoidance.

Businesses who will be SAT taxpayers have been represented on the SAT advisory group through the development phase of the tax. This includes representatives from trade bodies representing the majority of companies producing primary and recycled aggregate in Scotland.

The Scottish Government proactively engaged with nine aggregate suppliers/businesses, two industry representative bodies, two tax professional bodies and wider stakeholders ahead of the public consultation, helping to shape the options under consideration. The proposed arrangements for the cross-border scenarios have the potential to increase the administrative burden on aggregates producers. This is an unavoidable consequence of tax devolution and the establishment of two aggregate tax regimes within the UK.

The proposals also relate to businesses who have never had to previously consider administration costs in relation to AGL (e.g. builders’ merchants). Although the impact is expected to be light touch, it will be an additional administration consideration for this sector, particularly with rUK businesses who supply aggregate to Scottish customers. Proactive engagement with two relevant representative bodies has been undertaken in advance of the consultation.

Views were sought on a range of issues within the consultation to inform the relevant impact assessments to ensure that potential effects were fully considered. The main part of the consultation (section 2 – approaches to cross-border taxation) asked a number of specific questions on the business impact of the options.

Engagement with businesses continued following the consultation to ensure that all relevant cross-border scenarios are reflected in the design of SAT, and to enable a full discussion on the technical and financial implications of the proposed secondary legislation on businesses.