'Skip tax' will be catastrophic, firms warn MPs

Four firms face closure daily because of a massive increase in the tax levied on the waste in skips, a protest meeting in the House of Commons was told.

It was held after The Independent disclosed that the rate to dump some types of rubble in landfill sites had leapt from £2.50 a tonne to £64 a tonne. Companies warned that levels of fly-tipping would soar and rubbish go uncollected as a result of the "skip tax" announced last month.

Mark Bensted, managing director of the recycling firm Powerday, told MPs: "It's irresponsible, it's unfair and the implication of the rise could be catastrophic for this industry and the construction industry as a whole."

Drivers from skip hire companies have already staged a demonstration in Parliament Square and are planning their next protest. They warned firms will start going bust or dismissing staff within days.

But a spokesman for HM Revenue and Customs said: "We responded to concerns expressed by landfill operators that some companies were not paying the right rate of tax and in the process disadvantaging those who paid the correct rate."