Guide · UK · Budget 2026
The 28 October 2026 Budget set new rates for Landfill Tax, the Aggregates Levy and red diesel from 2027. If you are self-building, running a contractor-led job or a small building firm in the UK, here is what the published rates are and where they show up in your costs. Rates are taken from GOV.UK only.
Last updated 2 November 2026. Rates as published in the Budget 2026 Annex A: rates and allowances.
Not tax advice. Check the GOV.UK rates and speak to an accountant or adviser before you act.
| Charge | From | Before | After | Where |
|---|---|---|---|---|
| Landfill Tax, standard rate | 1 April 2027 | £130.75 per tonne | £136.70 per tonne | England and Northern Ireland |
| Landfill Tax, lower rate (e.g. inert soil and rubble) | 1 April 2027 | £8.65 per tonne | £14.60 per tonne | England and Northern Ireland |
| Aggregates Levy | 1 April 2027 | £2.16 per tonne | £2.26 per tonne | England, Wales and Northern Ireland (devolved to Scotland from 1 April 2026) |
| Marked gas oil (red diesel) duty | 1 July 2027 | £0.0648 per litre | £0.1165 per litre | UK — but not for construction use (see below) |
| VAT registration threshold | April 2027 | £90,000 | £90,000 (unchanged) | UK |
Source: GOV.UK — Budget 2026 OOTLAR, Annex A: rates and allowances
As a homeowner you normally don't pay Landfill Tax or the Aggregates Levy yourself. They come through in the prices you are quoted for skip hire, muck-away and aggregates. So don't add a separate tax line: treat the April 2027 rates as a possible uplift on those quotes.
Illustrative only.Assumption: 20 tonnes of inert muck-away (lower-rate material) sent to landfill in England after 1 April 2027, if your contractor's tip charges Landfill Tax. Clean inert soil often goes to quarry restoration or exempt sites instead, where this uplift doesn't apply. The lower rate rises by £5.95 per tonne (£14.60 − £8.65), so 20 × £5.95 = £119.00 of extra Landfill Tax that could be passed into the muck-away price. Assumption: 30 tonnes of aggregate; the levy rises by £0.10 per tonne, so 30 × £0.10 = £3.00. These figures are the rate change times the assumed tonnage only. They are not a skip or haulage price, and how much a supplier passes on is up to them.
The duty on marked gas oil (red diesel) rises from £0.0648 to £0.1165 per litre on 1 July 2027. Since 1 April 2022, construction plant and machinery can't use red diesel and must run on fully duty-paid diesel. Red diesel is limited to qualifying uses such as agriculture, horticulture, fish farming, forestry, rail, heating and electricity for non-commercial premises, golf courses and community amateur sports clubs, marine craft and travelling fairs and circuses. For most building sites this change won't touch your plant costs; check HMRC guidance if you are unsure.
Sources: GOV.UK — Reform of red diesel entitlement · HMRC — Excise Notice 75
The VAT registration threshold stays at £90,000 from April 2027 (deregistration £88,000). Small builders watching their turnover against it have no new figure to plan around.
In ConstructionPro.io you add skip hire, muck-away and aggregates as cost lines, and record each quote with its validity date. The app doesn't calculate Landfill Tax or the Aggregates Levy.
If a quote may not cover the April 2027 rates, see our contingency guide for how to handle cost risk, and our UK Budget 28 October 2026 guide for the other Budget changes.
Usually not directly. Landfill Tax is paid by landfill site operators and the Aggregates Levy by those who commercially exploit aggregate. On a home build they normally reach you inside skip hire, muck-away and aggregate prices, so treat the April 2027 rates as a possible uplift on those quotes rather than a separate tax line.
No. The UK Landfill Tax rates cover England and Northern Ireland. Landfill Tax was devolved to Scotland in April 2015 and to Wales in April 2018, which set their own landfill taxes.
GOV.UK says the Aggregates Levy was devolved to the Scottish Parliament on 1 April 2026, so the £2.26 per tonne UK rate is not the Scottish rate.
Generally no. Since 1 April 2022 red diesel is limited to set qualifying uses such as agriculture, horticulture, forestry, rail, non-commercial heating and electricity, golf courses and community amateur sports clubs, marine craft and travelling fairs. Construction machinery must use fully duty-paid diesel. Check HMRC Excise Notice 75 for your situation.
No. It stays at £90,000 from April 2027, with the deregistration threshold at £88,000.
Related: UK market overview.