A new eco “incineration tax” risks pushing councils to the brink, local authorities have warned.

Emissions from burning waste will be taxed from 2028 as part of Government efforts to encourage the uptake of greener technologies.

Around half of all household waste collected by councils is burned every year in facilities that produce the same greenhouse gases as around three million homes.

But the carbon tax could cost as much as £6.5 billion by 2036, and £747 million in 2028, according to research by the Local Government Association (LGA), the County Council Network (CCN) and the District Councils Network (DCN).

The tax, which currently applies to aviation, power and industry, adds around £65 per ton of carbon produced. Councils could be forced to raise taxes or cut other vital services unless the tax burden is shifted, the LGA warned.

All three bodies are calling for the taxes to be shifted to the industries that manufacture the materials, such as packaging, textiles and furniture.

Councils argue that they have no way of reducing the amount of waste they have to collect, while manufacturers can move to more recyclable materials.

The taxes would put an extra burden on councils already struggling to meet their financial obligations. Half of councils are warning of effective bankruptcy within five years amid rising social care costs, growing populations and caps on tax increases.

“Current proposals risk councils and local taxpayers facing enormous costs, which simultaneously risks the scheme failing to meet its objectives while exposing councils to significant additional financial risk,” said Cllr Adam Hug, the environment spokesman for the LGA.

Cllr Richard Clewer, the infrastructure and planning spokesman for the CCN, added: “If these costs are to be borne by councils, they will have to paid for by council tax or by reducing highly-valued services, so we are calling on the new Government to rethink these proposals.”

Waste incineration is the main destination for household rubbish that is not recycled, and the number of plants is expected to increase by 30 per cent in coming years.

But the practice has been criticised by environmental campaigners for the amount of emissions and air pollution produced, and over concerns that recyclable waste also ends up in incinerators. One analysis found that more than half of plastic that ends up incinderated is either “readily recyclable” or “potentially recyclable”.

Cllr Andy Graham, the DCN environment spokesman, said: “Taxing councils for the waste we have little option but to incinerate would be a bombshell for the delicately-balanced funding of local waste services – including district councils’ successful efforts to increase recycling.

“We want to make it easier for our citizens to recycle materials like clothing and medical waste so it doesn’t need to be incinerated. We can only do this through action from producers, who should be incentivised to produce recyclable goods and penalised if they don’t.”

A Department for Energy Security and Net Zero spokesman said: “We are committed to expanding the UK ETS [emissions trading scheme] to include waste incineration and energy from waste facilities from 2028. We will continue to engage with the sector on our proposals, and will publish further detail in due course.”