Select Committee on Northern Ireland Affairs Minutes of Evidence

Letter from the Financial Secretary, HM Treasury to the Chairman of the Committee

  Thank you for giving me the opportunity to tell you about the development of the aggregates levy last Thursday.

  In today's Pre-Budget statement, the Chancellor of the Exchequer proposed a phased introduction of the levy on aggregates used in processed products in Northern Ireland, subject to European Commission state aid approval.

  The Government has considered in detail the impact of the aggregates levy on Northern Ireland. As a result, it is attracted to phasing in the levy for aggregates used in processed products in Northern Ireland over a period of up to five years. This will allow this specific sector time to adjust to changed market conditions. We will need state aid approval from the European Commission for this proposal and will be submitting a notification to the Commission shortly.

  As you know, imports of unprocessed aggregate will be subject to the levy while exports will be relieved. Together with arrangements to phase in the introduction of the levy for the aggregates used in the manufacture of processed products in Northern Ireland, this will avoid adverse effects on the competitiveness of quarries there.

27 November 2001

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