Plastic packaging tax: What does my business need to know?

Set to come into force from April of 2022, the UK’s new Plastic Packaging Tax is likely to weigh on importers of any goods that contain or are concealed in plastic packaging.

Designed primarily to reduce the amount of plastic packaging crated, rather than to raise revenue, the incoming tax will be levied on packaging that contains less than 30% recycled material.

In cost terms, the going rate has been set at £200 per metric tonne of plastic for that that sits under the 30% threshold.

Plastic packaging will be defined as such is the plastic is the heaviest component in the packet.

Though up for review in the UK and being challenged in the courts in Europe, so-called green plastics, such as biodegradable and compostable plastics, will still be likely to get caught up in the tax adjustment.

Exceptions will seemingly only be made whereby the ‘transport packaging’ is deemed necessary for the safe transport of the goods.

As for exports, no PPT will apply if the goods are exported inside 12 months of manufacture.

The bill is most likely to be foot primarily by manufacturers and importers that handle more than ten metric tonnes annually. Factoring in the new costs, it would be unsurprising to see some minor impact on prices down the line.

What may become required is some inclination on contracts and invoices as to whether the tax has been accounted for. This means that those bringing in plastic packaging will need to register with HMRC if they are responsible for north of ten metric tonnes.

Record keeping will need to show totals by weight (excluding transport packaging), the data showing make up of the packaging, the weight of exempted plastics and the reasoning, as well as similar detail on exports.

For the full and detailed Government summary, see here.

Within the bike industry a handful of brands have taken the issue of plastic consumption on, turning waste into products, while initiatives like Trash Free Trails are picking up speed in an effort to tackle the plastic pollution epidemic.