New ACT levy on dumping waste?
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New ACT levy on dumping waste?

The ACT government is considering charging a new levy on businesses which dump waste.

Households would be exempt, but waste from businesses such as builders and restaurants would be subject to the new charge.

The idea is to make the dumping of refuse more expensive to try to deter businesses from taking it to landfill sites and to recycle instead.

News of the levy came in the City Services annual report, which says the authority is "investigating and developing options for a broad-based waste levy", with the aim of raising money to expand recycling.

A lot of waste on local landfill but would a levy on dumping get it down?

A lot of waste on local landfill but would a levy on dumping get it down?Credit:Fairfax

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Officials in the administration are working out the complexities of the plan.

In a briefing offered by City Services, one official described waste as like a river - it tends to flow to the lowest point. In other words, waste gets dumped where it's cheapest to dump it. The aim is to make dumping less cheap relative to recycling.

Officials are working out how high the levy should be to make it work - too high and it's a heavy burden on business; too low and it's not a disincentive to throwing stuff out.

On top of that, if any new charge on dumping in the ACT is too high, the waste will get carried to where it's cheaper - like over the border to NSW.

NSW already has a scheme with a variable waste disposal levy across the state. Each tonne of rubbish costs the dumper $140 but that amount drops as you move away from Sydney. In the areas of NSW immediately around the ACT, landfills don't levy trucking companies for dumping rubbish.

The public wouldn't pay the levy on waste dumping directly but the expectation is that if, for example, a builder did work on your property, the price would incorporate the disposal of the rubbish.

And that adds a further complexity: if the ACT has too high a levy, officials recognise that companies thinking of locating here might be put off investing.

No final structure has been decided nor a time frame but the number crunching and economic analysis are already underway.

One option is just to charge each truck that turns up at a landfill dump - the trucking company pays the levy no matter how far the load has come - and the bill is passed on to the original dumper.

But that might encourage companies from far away to just take loads to whichever dump proves cheapest, weighing transport costs against the levy.

The other option is to have a register of waste disposal companies and bill them according to the weight of the load and how far it travels. This method would deter companies from trucking waste across states to the lowest cost dump but would be more bureaucratic.

Queensland is to bring in a levy on dumping in 2019 because companies in NSW, where there's already a levy, were transporting rubbish north to dump at the cheaper option.

When the Queensland decision was made, business groups said the levy would be another burden that would squeeze their profits.

Opposition politicians there said that the cost would fall on ordinary people.

"This tax will hit every industry from construction to manufacturing, tourism and hospitality because it will cost more for businesses to dispose of their waste," one said.

"Those businesses will have no choice but to pass the cost on to their customers or be out of pocket themselves, and that's not fair."

ACT officials say they will talk to all the people and groups which might be affected, including in New South Wales.