Landfill Tax Just Got a Lot More Expensive — What It Means for Your Business

If you dispose of inert or lower-risk waste to landfill, your costs changed significantly on 1 April 2026. The lower rate of landfill tax, which applies to materials such as soils, concrete, ceramics and other inactive wastes, more than doubled overnight, rising from £4.05 per tonne to £8.85 per tonne. That is a 113% increase and the largest single uplift to the lower rate in a decade.

The standard rate, which applies to most other waste types including mixed and hazardous waste, increased more modestly to £130.75 per tonne, a rise of 3.7%.

The increases came after the government stepped back from more radical proposals that were under consideration ahead of the Autumn Budget 2025, including plans to merge the standard and lower rates entirely by 2030. That more disruptive convergence has been shelved for now, but the direction of travel is clear. Landfill is becoming more expensive as a matter of deliberate policy, and the lower rate, which had historically provided a relatively affordable disposal route for inert materials, is being brought progressively in line with that direction.

For businesses generating construction waste, excavation spoil and similar inert materials, the practical question is whether landfill remains the most sensible disposal route, or whether recovery, reuse and recycling alternatives now make stronger commercial sense. In many cases, the numbers are beginning to shift that calculation.

The government has confirmed the two-rate structure will be maintained. The plan to converge the standard and lower rates into a single rate by 2030 has been shelved for now. But this does not mean rates will stop rising. The government has also confirmed that the gap between the two rates will not be allowed to widen further, which sets a floor but not a ceiling on the lower rate’s future trajectory.

The Landfill Communities Fund which allows landfill operators to contribute to an approved Environmental Body and claim back 90% of that contribution as a credit against their landfill tax bill remains in place. The 5.3% cap on the total credit claimable applies for 2026/27.

Businesses should also be aware that the UK Emissions Trading Scheme is expected to expand to cover Energy-from-Waste facilities from 2028 onwards. This will increase the cost of alternative disposal routes, changing the economics of inert waste management further still. Landfill is not the only route that is becoming more expensive. The entire disposal cost landscape is shifting.

Soil and aggregate recovery, concrete crushing and reuse, and material recycling routes that avoid landfill entirely have all become more commercially attractive relative to disposal. If your current waste disposal contract was priced before April 2026, it is worth reviewing whether the cost assumptions still hold.