Scottish Aggregates Tax - proposed administration regulations: consultation analysis

1. Introduction

1.1 This report provides an analysis of responses to the Scottish Government consultation titled ‘Scottish Aggregates Tax: Proposed Administration Regulations^[1]’ (hereafter referred to as ‘the consultation’). In addition, it sets out the Scottish Government’s response to the consultation and a summary of next steps.

1.2 The Scottish Government would like to thank all respondents for their contributions.

1.3 Views were invited as part of an eight-week consultation period between 24 January 2025 and 21 March 2025. The consultation invited comments on draft legislation designed to support the introduction and effective operation of Scottish Aggregates Tax (SAT). The consultation focused on the administration requirements associated with SAT, alongside required changes to the Revenue Scotland and Tax Powers Act 2014 (RSTPA) regulations^[2] and the First-tier Tribunal for Scotland Tax Chamber regulations^[3].

1.4 The intent of these regulations is to deliver an operationally effective SAT and ensure that the tax operates effectively in relation to the wider devolved taxes legislative regime, as set out in the Revenue Scotland and Tax Powers Act 2014^[4] (RSTPA).

1.5 The consultation also sought views on a range of issues to inform relevant impact assessments.

1.6 Respondents were invited to respond by post, via Citizen Space^[5], or by email to the Scottish Government’s Fully Devolved Taxes Unit mailbox.

1.7 Prior to the consultation, the Scottish Government also engaged with a SAT expert advisory group on the proposed SAT administration regulations. The comments and feedback received from advisory group members are also summarised in this document. Where relevant, commentary on decisions taken by the Scottish Government for the secondary legislation, following consultation and engagement, is provided.

1.8 Three responses to the consultation were received from stakeholder groups. Two of the three respondents to the formal public consultation requested that their responses not be published.

1.9 Two responses were also received from the SAT advisory group members prior to the launch of the consultation. For the purposes of the analysis, the two responses from SAT advisory group members have also been included, and respondents have been broadly categorised (see Table 1).

1.10 Respondents provided a range of comments on each of the draft clauses. While there is evidence of consensus in some areas, a number of unique concerns and proposed amendments were highlighted.

1.11 A list of respondents is available in Annex A. Where permission has been given, responses have been published in full at www.consult.gov.scot.

1.12 The consultation responses were analysed by officials from the Scottish Government and Revenue Scotland. This also included engagement with stakeholders separately on points raised as part of the consultation.

1.13 Key findings from the analysis are presented in chapters 2, 3, and 4 of this document. Chapter 5 sets out the next steps.

Summary of Views

1.14 The key points that emerged from the consultation responses were:

• The definition of an aggregates invoice (as stipulated in the draft secondary legislation) would cause problems for the primary aggregates industry, and that this should be streamlined.
• A view that there will be an administrative burden on taxpayers due to the level of information being requested in the aggregates invoice and tax return.
• That penalties for failure to use a weighbridge/specified method seem harsh (for example, whereby operators have acted in good faith but have accidentally made mistakes, a weighbridge is broken, etc.).
• Further clarity is required on whether registration for SAT can be done at group level rather than site. Not allowing this would cause an administrative burden for taxpayers.
• That the 30-day tax return period may not be sufficient given the additional information requirements for the return over and above current requirements of the UK Aggregates Levy (UKAL).
• A view that, for taxpayer clarity, it would be better if the return date aligns with payment date. If these dates are to be different it opens a discussion on the practicalities and processes that would be required should a taxpayer subsequently determine their tax liability is different on completion of their return.
• Concerns that the time limit of one year for claims is too short in comparison with the usual time period of 4 years for most tax credit claims.
• Changes and clarifications required to the partial Business and Regulatory Impact Assessment (BRIA), including:
  • Further reference to research being undertaken to better understand the evidence base on the role of recycled aggregates.
  • Further detail on the compliance costs to affected businesses.
  • An update on the assessment of cross-border complexities.
  • Information on the number of visits undertaken and the methodology used to select which operators were approached / visited.
  • Post-implementation review: further information is needed on what intervals the reviews will take place, how these will be carried out, and the level of detail to assess effectiveness of SAT.

Next Steps

1.15 The material and views gathered through the consultation activities have informed the development of SAT policy in advance of the proposed introduction date of 1 April 2026.

1.16 The Scottish Government has carefully considered all of the responses to the consultation, which will inform and finalise decisions on legislation for introduction to the Scottish Parliament.

1.17 The secondary legislation will be considered by the Scottish Parliament in line with its established process for examining draft legislation, more details of which can be found on the Scottish Parliament website^[6].