UK Drops Energy Project Tax Breaks
October 29, 2015 Taxation in UK
LONDON – In order to allay the fear that community energy projects are being misused by venture capitalists, the UK government has dropped the tax breaks previously made available for the construction of renewable energy projects.
On October 26th the Financial Secretary to the Treasury David Gauke announced that community energy projects in the UK will no longer be eligible for tax breaks, a move which will put even more strain on the sector.
From November 30th this year, community energy programmes will no longer be eligible to receive Enterprise Investment Scheme (EIS) and Seed Enterprise Investment Scheme (SEIS) tax relief, or Social Investment Tax relief (SITR).
Explaining the decision to cut tax breaks for the community energy programs, the Financial Secretary said that the new rules “…follows the announcement in the summer Budget that the Government would continue to monitor the use of the venture capital schemes by community energy to ensure that the schemes were not subject to misuse and that they provided value for money to the taxpayer.”
However, critics of the decision have already claimed that the new rules will make it harder for community groups to raise the funds necessary to construct new independent and renewable energy manufacturing facilities.
Photo By: Wayne National Forest