“21. The crux of the dispute between the parties does not turn upon construction of the word "disposal". It depends upon what is a taxable disposal. Is it a disposal made at one time? 22. I am of the view that the natural meaning of section 40(2) requires a disposal which is a taxable disposal to satisfy the conditions in subsections (a), (b), (c) and (d) at the same time. Those subsections use the word "it" to refer back to the "disposal" which suggests that the disposal has to be made at a landfill site by way of landfill and also to be a disposal of material as waste. 23. The tax is a landfill tax, not a landfill and recycling tax. The tax is to be paid when waste material is disposed by way of landfill in a landfill site: not on waste material (e.g. fines) which has been recycled (e.g. into blocks) which may be used in a landfill site (e.g. to build a wall or hard standing). The disposal referred to in section 40(2) is a particular disposal. 24. The Commissioners' submissions that each condition in section 40(2) was self-contained could not have been intended by Parliament. It would mean that once there was a disposal of material as waste by somebody, tax became payable by the site operator if the material was deposited on the ground in a landfill site. Thus liability to pay tax, which in practice will be passed on by the site operator, can depend upon the intention of a person unknown to the site operator at an unknown time, even before1st October 1996 . 25. Mr Havers accepted that upon the Commissioners' construction there could be cases where the history of the material was not known and therefore difficulties could arise. He described them as few in number and at the margin. They were and could be dealt with by the Commissioners in an appropriate manner. 26. For the purposes of the appeal I accept that such cases are at the margin. But even so, I do not believe that Parliament could have intended to impose a landfill tax upon recycled material with the necessity that the history of the material had to be checked to ascertain whether anybody had the required intention. 27. The Commissioners also submitted that there was nothing in the statute which suggested that material which had been discarded as waste ceased to be waste because it had been successfully recycled. That submission is contrary to common-sense. Take material which is thrown away. That is waste. Melt it down and mould it into a spare part for a machine and it is not waste. There need be no change in chemical substance to convert waste into a useful product. It is the act of recycling which is important. This is recognised by Parliament in its drive to promote recycling rather than disposal and is recognised by the cumulative effect of section 40(2). 28. The Commissioners accept that their argument leads to the result that companies such as Parkwood will be liable for tax if they use recycled material for site engineering or building purposes, whereas they would not be liable for tax if they used fresh materials. That cannot have been the intention of Parliament when they introduced the landfill tax. The purpose of the legislation was to tax waste material deposited at landfill sites and not to tax deposits at landfill sites of useful material produced from waste material. 29. The Commissioners' need to advance their arguments stems from their belief that the requirement that all four conditions of section 40(2) should be satisfied at the same time would allow tax avoidance by the simple mechanism of inserting an intermediary between the originator of the material and the landfill site operator. For example, if X wished to get rid of some soil, he could do so by taking it to a landfill site and disposing of it. The result would be a taxable disposal even if the landfill site used it for road making. However X can avoid the tax by structuring the disposal as a sale. X sells to Y at say 25 pence per tonne. Y sells to the landfill operator at say 50 pence per tonne for site use. If the Commissioners' submissions are wrong, then no tax would be payable. 30. In the circumstances postulated the intervention of an intermediary would avoid tax being payable. I do not find that surprising as the purpose of the tax has not been avoided. The soil has not been disposed of as waste at the landfill site. It is not the insertion of an intermediary that makes the difference: it is the intention of the disposer at the site. Thus if X wants to get rid of his soil and sells it to the landfill site for road making, no tax will be payable. Thus the tax bites upon the person who discards not who recycles. 31. The Tribunal were correct to concentrate upon the disposal at Parkwood's landfill site because it was that disposal which was made by way of landfill. They rightly held that that was not a disposal as waste. I would allow the appeal.”
“The central purpose of the landfill tax was stated to be: "… to ensure that landfill costs reflect environmental impact thereby encouraging business and consumers in a cost effective and non-regulatory manner, to produce less waste; to recover value from more of the waste that is produced; and to dispose of less waste in landfill sites.” ”
“Provision of materials for the construction of such cells must necessarily come within the costing process of manufacture of such materials being disposed of and, whether bought from third parties or produced internally, cannot be considered as waste.”
“21. The material in the instant case, the top soil and subsoil, was removed and transported away from Wilson Bowden’s and Hallamshire’s sites. Those were important processes of disposal. Even if it is accepted that the soil was deposited on behalf of Darfish, nonetheless the disposal was made on behalf of Wilson Bowden and Hallamshire, because it was they who requested the removal and transport of the soil away from their sites and those processes were made in pursuance of contracts with those companies (see section 64(4)). In those circumstances, section 64(3) requires the Tribunal to examine the intentions of Wilson Bowden and Hallamshire. 22. Since it appears that the Tribunal found that the deposit (and possibly the transport) were made on behalf of Darfish, it is argued that its intention was the only intention which the Tribunal was required to consider. I disagree. I have construed disposal as the antonym of retention. The focus of the provisions is upon the person getting rid of something, not upon the person retaining or acquiring something. DNS was not making a disposal, on my construction, on behalf of Darfish. It was assisting in the acquisition and retention of the material on behalf of Darfish. But it was making a disposal on behalf of Wilson Bowden and Hallamshire, and it is their intention which should have been determined by the Tribunal.”
“If waste is processed before its disposal to landfill and the process changes it into useful material, the original producer’s intention is no longer relevant. The landfill tax liability is determined by the intention of the recycler, as evidenced by the nature of the transaction. The following table gives examples of the processes that may discount the original producer’s intention.”
“composting, crushing, bailing, sorting or screening”
“It strikes me as illogical that material which this week is waste which one must pay to dispose of becomes next week a useful commodity because a landfill site operator is short of material yet is waste again in the following week because there is a market surplus.”