The Budget 2020 was released on Wednesday 11 March outlining the government’s decision surrounding the plastic packaging tax. The plastic packaging tax will be introduced from April 2022 and place a charge on plastic packaging with less than 30% recycled content. Budget 2020 outlines the actions the government will take from April regarding the distribution of the UK’s money. A focus was put on improving environmental initiatives by planting more trees, reducing pollution and amending taxes on plastic and fuel.
In a bid to grow a greener economy, Chancellor Rishi Sunak revealed that plastic packaging will be taxed at £200 a tonne. By introducing the tax, the government aims to discourage the production of new plastics, improve recyclability and reduce the amount of plastic in the natural environment. Sunak explained that the plastic packaging tax “will increase the use of recycled plastic in packaging by 40% – equal to carbon savings of nearly 200,000 tonnes.”
The tax will apply to businesses importing and producing plastic packaging in the UK. The tax extends to importing filled plastic packaging and small businesses will be subject to a 10-tonne threshold to keep costs proportionate. There is an exemption for businesses that produce or import less than 10 tonnes of plastic packaging within 12 months from the introduction of the tax.
The guidelines had not been previously outlined as the government was forming its specifications based on consultations held in 2019. The consultations and meetings allowed stakeholders to share their opinions on the tax and its implications. Questions included whether the tax should be applied at a flat rate, if it should include exported plastic and whether it should apply to small businesses.
The plastic packaging tax came about as it was highlighted that recycled plastic is often more expensive to use than new plastic. Businesses continue to buy and produce new plastics to keep costs down, despite the detrimental effects on the environment. This is a fundamental problem that’s contributing to the climate crisis and plastics polluting the environment. By introducing the tax, the government hopes to increase the demand for recycled plastic as businesses won’t want to pay the £200 a tonne fee.
Environmental bodies and businesses in the recycling and waste management sector have expressed their support for the plastic packaging tax. They hope it will show plastic manufacturers the impact of new plastic production on the planet. With limited recycling and waste management facilities in the UK, continuing to produce more and more new plastics puts a strain on local councils. This is why tonnes of waste is shipped overseas to countries with a larger capacity for handling plastic rubbish.
A new consultation is now open until 20 May 2020 where businesses, individuals and professional bodies can share their views surrounding the latest updates. Further consultation is also opening on the specific design and implementation of the tax – including whether or not to exempt some types of medical packaging made from plastic.
Pro Environmental welcomes the introduction of the plastic packaging tax as a way to reduce the production of new plastic and increase the use of recycled materials. As a plastic reprocessor, Pro Environmental encourages businesses to use recycled PET plastic for food and beverage packaging. We aim to make the economy truly circular by encouraging manufacturers to only use existing sources of plastic that can be fully recycled.