Budget 2025 – what does it mean for metal recyclers?

Earlier today, the Chancellor of the Exchequer Rachel Reeves MP delivered her Budget.
 
As per parliamentary convention, the Budget is meant to contain an element of surprise. But with many of the policies announced today, trailed in the media in the weeks beforehand, we apologise if you’re already familiar with many of these announcements.

As expected, this Budget has included several tax rises in order for the Chancellor to remain within her own fiscal rule of matching day-to-day spending with tax receipts. However, of the tax rises announced today, the impact on metals recycling operators – in comparison to gambling operators or landlords for example – is lighter.

For metal recyclers who pay any 18-20 year-old staff the Minimum Wage, and over 21 year-olds the Living Wage, the cost of employment will go up. This is because the Chancellor chose to accept the recommendations of the Low Pay Commission in full, meaning the Minimum Wage will rise from £10.00 to £10.85 and the Living Wage will rise from £12.21 to £12.71.

Landfill Tax is also going to change. As BMRA members will know, BMRA made a representation to HMRC on its Consultation on reform of Landfill Tax, citing that the existing system is prone to abuse, whereby some operators may deliberately misdescribe their wastes as 'inert' or 'qualifying' to obtain the lower rate. Chancellor Reeves announced that Government would not introduce a single rate of Landfill Tax, but would be converging the price difference between the ‘standard rate’ (currently £126.15) and the lower rate (currently £4.05). Rest assured, BMRA will provide additional updates when more detail emerges.

Employers who have transitioned their employee’s vehicle fleet to electric or plug-in hybrid vehicles will likely see their costs rise from 2028. This is due to the Chancellor announcing a new Electric Vehicle Excise Duty of 3p per mile for electric vehicles and 1.5p per mile for plug-in hybrids to take effect from 2028 onwards.

Labour’s manifesto commitment to cap corporation tax at the current level of 25 per cent was maintained.

The Government is extending the temporary 5p cut to fuel duty for a further five months, as well as cancelling the planned inflation increase for 2026-27. Given the increase in fuel costs in recent years for operators, this is welcome news. However, after the extension, the fuel duty rate will gradually return to early 2022 levels, so we can expect fuel costs to rise in the not too distant future.

Keen news readers and watchers may recall earlier this week, Secretary of State for Business and Trade, Peter Kyle trailed a couple of policy announcements which were confirmed by the Chancellor today. One of those was a promise to slash electricity bills for key industries via the implementation of the British Industrial Competitiveness Scheme. Our initial reading of the consultation on the scheme’s eligibility and approach (published this week) suggests metal recyclers may be included. Again, we will update members as more detail on this policy emerges.

The other policy announced by the Business Secretary – and confirmed today – was Government’s investment in critical minerals. This follows the publication of a new Critical Minerals Strategy last Sunday, which earmarked a pot of £50 million for critical mineral projects in the UK, which recycling projects will be able to bid in to.

If you’d like to contact the BMRA about today’s Budget, do not hesitate to do so. We’re contactable via E: [email protected] or T: 01480 445249