Appendix 9
S.I. 2011/2132: memorandum from the Department
for Environment, Food and Rural Affairs
Plant Protection Products (Fees and Charges)
Regulations 2011 (S.I. 2011/2132)
1. The Committee has asked the Department for
Environment, Food and Rural Affairs for a memorandum on the following
point:
Explain (with an example) how the amounts which
authorisation holders are liable to pay in accordance with regulation
8 are intended to be calculated and demonstrate how effect is
given to that intention, commenting (in particular) on how a "financial
year" is identified and on which financial year is relevant
to any particular liability period.
2. The intention is that the annual charge in
any particular year will relate to costs incurred within a liability
period starting with 1st April in one year and ending with 31st
March the following year ("liability period" is defined
in regulation 2).
3. In order for a UK competent authority to calculate
the annual charge for an authorisation holder in relation to,
for example, the 2012/2013 liability period it must work out its
own total costs incurred within that liability period ("total
costs incurred" are defined in regulation 8(6)) and the "total
annual turnover" (regulation 8(3)).
4. Each authorisation holder's annual turnover
(needed in order to calculate the "total annual turnover")
is calculated by reference to sales in its financial year. In
this example, the financial year for each authorisation holder
is calculated by reference to the 2012/2013 liability period (regulation
8(6)).
5. If, for example, a particular authorisation
holder (AH) has a financial year that runs from 1st January to
31st December, the first step is to identify the calendar year
in which the relevant liability period starts, namely 2012. AH's
annual turnover is then calculated by reference to its sales in
its financial year ending between 1st October 2011 and 31st September
2012 (the latter date being calculated by reference to the year
in which the liability period starts). In this example, therefore,
AH's financial year is 1st January 2010 to 31st December 2011
(regulation 8(6)).
6. Once a United Kingdom competent authority
has the figures for its total costs incurred for the 2012/2013
liability period and the total annual turnover (calculated by
reference to the 2012/2013 liability period) it divides the former
by the latter and multiplies that figure by 100 in order to obtain
a percentage which is then applied to each authorisation holder's
annual turnover.
7. Each authorisation holder is obliged to provide
an authority with evidence of its annual turnover for a given
liability period on request (regulation 8(4)).
8. Using the following assumptions:-
i) AH's annual turnover for 1st January 2010 to 31st
December 2011 is £2,350,000,
ii) the total annual turnover for all authorisation
holders (calculated by reference to the 2012/2013 liability period)
is £610,000,000, and
iii) the total costs incurred in the 2012/2013 liability
period are £3,419,000.
Stage one in the calculation of AH's annual charge
in relation to the 2012/2013 liability period is: A ÷ B x
100.
A = £3,419,000 (total costs incurred in the
liability period), and B = £610,000,000 (total annual turnover).
£3,419,000 ÷ £610,000,000 x 100 =
0.56%.
Stage two is applying that percentage to AH's annual
turnover. 0.56% of £2,350,000 is £13,160. This is
the amount AH would be charged in relation to the 2012/2013 liability
period.
Department for Environment, Food and Rural Affairs
21st October 2011
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