Are you ready for the UK Plastic Packaging Tax?

01st Feb

The Plastic Packaging Tax is due to be introduced on April 1, 2022, and the tax applies to all plastic packaging produced within the UK. Don’t forget – it also applies to imported plastic packaging too.

Here at Springpack, we’ve been working with our customers on their plastic usage, and switching to more eco-friendly packaging solutions, but now is the time to make sure you’re ready for the incoming changes.

So why is the Plastic Packaging Tax being introduced?

Put simply, it’s to encourage the sustained use of recycled plastic. One of the main aims is to reduce the amount of plastic being sent to landfill.

Plastic packaging that contains less than 30% of recycled plastic will face a tax charge of £200 per tonne.

By incentivising the use of recycled plastic, it creates a greater demand for recycled material. This will hopefully lead to increased levels of collection, and ultimately, recycling.

For the tax, the term ‘Plastic’ means any material consisting of a polymer. This includes all compostable, biodegradable and oxo-degradable plastics.

For the tax, the term ‘Recycled Plastic’ is plastic that has been reprocessed. There are two types:

Pre-consumer material: Material diverted from the waste stream during a manufacturing process.

Post-consumer material: Material generated by households, commercial, industrial and institutional facilities in their role as end users of the product, which can no longer be used for its intended purpose.

How can my business prepare for the Plastic Packaging Tax?

Make sure you are up to date on the rules, and check whether you qualify for exemption. Now is the time to ensure you have made the necessary substitutions in packaging.

We recommend creating a file of products containing less than 30% recycled content. If you need help with this, contact the Packaging Pros at Springpack, and we’ll be able to help.

Once you’ve identified your products, you can begin sourcing alternatives containing recycled content. Springpack can help you with this – just email your product list to the team at: enquiries@springpack.co.uk.

For up to date and further information on the Plastic Packaging Tax, we would recommend you head over the Government website.

How is recycled content calculated?

Recycled content is calculated using the mass balance approach:

For example, if plastic item weighing 50g has 16g of recycled content, the % recycled content is 32%. This would therefore be exempt from the Plastic Packaging Tax.

Plastic Packaging Tax Reporting

As soon as you exceed 10 tonnes of plastics purchased, you will have 30 days to register with HMRC. Your Tax returns must be submitted every quarter, and records of plastic usage must be kept. For example, keep records of packaging weights, and the recycled content found within.

Is anyone exempt from the Plastic Packaging Tax?

Some products are exempt from the Plastic Packaging Tax. There are four exemptions, regardless of the amount of recycled plastic they use;

  • Medical packaging
  • Transport packaging
  • Aircraft packaging
  • Components with other uses than packaging 

In summary

Here are the key takeaways for the Plastic Packaging Tax:

  • Plastic Packaging Tax is due to take effect from April 1, 2022.
  • The tax will be £200 per tonne (apportionment for part thereof).
  • The tax applies to plastic packaging manufactured in or imported into the UK containing less than 30% recycled plastic, when measured by weight.
  • It applies to businesses that manufacture or import plastic packaging components, or import packaged goods into the UK.
  • If your business is in the UK, you will be liable for the Plastic Packaging Tax if you perform the last substantial modification* before the packing or filling process.
  • ‘Small operators’ who manufacture or import less than 10 tonnes of plastic packaging in a 12-month period are exempted from the charge.
  • There are anti-avoidance rules dealing with the artificial separation of business activities to avoid the tax.

*Last Substantial Modification: Examples of manufacturing processes that are substantial modification processes; this is not an exhaustive list:

Extrusion, moulding, layering and laminating, forming and printing

To get in touch with us regarding swapping products for more eco-friendly alternatives, you can call us on 01905 457 000 or email enquiries@springpack.co.uk.

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