Community Energy England shelves legal action over tax relief cull

Community Energy England (CEE) has confirmed that it will not pursue a judicial review over HM Treasury’s decision to make community energy projects exempt from EIS, SEIS and SITR tax relief.

The industry body made the announcement this afternoon, stating that while it considered it had a legitimate case it had chosen “not to devote scarce resources to pursuing the matter”.

A statement issued by CEE said that the government’s legal department responded to a pre-action letter originally sent in November last year stating its intent to pursue the matter. CEE claimed that HMT had failed to provide the industry with the six months notice it had previously agreed to.

CEE alleges that government lawyers stated that an earlier ministerial statement that the department was “monitoring” such schemes for potential abuse served as notice for community energy enterprises.

CEE rejected the argument, stating that a court would rule in its favour, but has nevertheless elected to concentrate its efforts on collaborating with the Treasury and attempt to make it reconsider its approach before the Social Investment Tax Relief scheme is extended later this year.

“We are disappointed that HM Treasury refused to provide the results of its monitoring to justify its U-turn… It offered just one document, but only if we kept it secret. This isn’t a national security matter, so we have concluded that the evidence is too weak to be published,” CEE chairman Philip Wolfe said.