The Institute for Economic Affairs says steep rises in landfill tax have helped drive fly-tipping to record levels in England, while bringing in less revenue than expected. It argues that higher taxes can make illegal dumping more attractive and says the broader pattern of tax rises on landfill, tobacco and alcohol has created opportunities for criminal markets.

Landfill tax rose from £7 a tonne in 1996 to £126.15 in 2025, while fly-tipping increased by 31 per cent since 2018/19 to 1.26 million incidents in England in 2024/25. The report cites a £240 million gap between estimated landfill tax liabilities and receipts, and a 21,000-tonne dump in Oxfordshire with a projected £7.3 million clean-up cost. It also says illegal cigarettes account for 32.3 per cent of the market, and that combined receipts from alcohol, tobacco and landfill duties were £5.2 billion below forecasts in 2024/25; local authorities can impose fly-tipping penalties of up to £5,000.