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Northern Ireland Gas Supplies

Volume 522: debated on Monday 31 January 2011

The Government have today announced the climate change levy [CCL] exemption for supplies of gas in Northern Ireland will be replaced with a lower rate from 1 April 2011.

Following discussion and agreement with the Department of Enterprise, Trade and Investment in Northern Ireland, legislation will be introduced in the Finance Bill 2011 to remove the exemption and replace it with a lower rate for a transitional period of 1 April 2011 to 31 October 2013, after which the main CCL rate for gas will apply in Northern Ireland. During the transitional period such supplies will become subject to the levy at a rate of £0.00059 per kilowatt hour, which is 65% lower than the full rate of CCL on gas for business and public sector consumers. Domestic consumers do not pay CCL.

Following consultation with the European Commission, the Government consider it is unlikely that they would be able to secure re-approval for the exemption. The measure is therefore necessary to ensure compliance with European tax law and state-aid rules.

To give gas suppliers and business gas consumers certainty over their tax affairs, this announcement is being made early to allow energy suppliers and businesses in Northern Ireland time to start to prepare for the introduction of the lower rate on 1 April 2011.

Copies of the draft legislation and tax information and impact note have been deposited in the Libraries of both Houses and are available on the Treasury website at