UK Budget Introduces Plastic Tax

The Chancellor of the Exchequer, Rishi Sunak recently announced a tax on plastic packaging during his 11 March Budget, as part of the government’s drive to achieve its net-zero targets for 2050. From April 2022, any plastic packaging that contains less than 30 per cent recycled content will be taxed at £200 per tonne, reports Let’s Recycle.

Delivering the first Budget under Boris Johnson’s majority government, Mr Sunak said the new tax would help tackle plastic pollution and boost the use of recycled plastics by 40 per cent. Alongside this, the Treasury has released a £700,000 fund for the development of an IT framework to administer the new Extended Producer Responsibility scheme for the packaging industry.

The Plastic Packaging Tax will see businesses paying £200 per tonne of packaging made from less than 30 per cent recycled plastic. The tax will begin in April 2022.

The new tax was first announced in Budget 2018 and is meant to tackle the ‘scourge’ of plastic pollution in the environment, and to incentivise the use of recycled plastics. In Spring 2019, a consultation suggested that £150 per tonne would be appropriate.

The Chancellor said: “From April 2022, we will charge manufacturers and importers £200 per tonne on packaging made of less than 30 per cent recycled plastic.”

“That will increase the use of recycled plastic in packaging by 40 per cent – equal to carbon savings of nearly 200,000 tonnes.”

Treasury budget documents gave more detail on the scheme, explaining that the £200 per tonne rate applies to “the production and importation of plastic packaging” and would be subject to review.

The Budget documents said: “The government will keep the level of the rate and threshold under review to ensure that the tax remains effective in increasing the use of recycled plastic.

“The government will also extend the scope of the tax to the importation of filled plastic packaging and apply a minimum threshold of 10 tonnes of plastic packaging to ensure the smallest businesses are not disproportionately impacted.”

The Budget also included “an additional £700,000 to establish the Extended Producer Responsibility scheme, designed to encourage producers to make their packaging more recyclable and reduce the amount of unnecessary packaging in their products.”

There has also been a commitment to fighting waste crime by funding a digital waste tracking system that will provide detailed data on waste transport, and £2 million “to improve evidence on where fly-tipping happens and the best ways to deter it.”

Concluding, Mr Sunak said: “We promised to provide green growth and protect our environment… this Budget gets it done.

“There can be no lasting prosperity for our people if we do not protect our planet.”

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