The new Plastic Packaging Tax (PPT) comes into force on 1 April 2022. The tax will result in businesses being charged at a rate of £200 per tonne of plastic that contains less than 30% of recycled plastic.
If you’re a business owner and this impacts your business, you will need to submit tax returns on a quarterly basis. You must also keep records of the recycled content of your packaging. This can include product specifications, invoices, and contracts where relevant.
Who will be liable to pay UK PPT?
You will need to register for the Plastic Packaging Tax if you’ve manufactured or imported 10 or more tonnes of finished plastic packaging components within the last 12 months, or will do so in the next 30 days.
This will impact businesses in a range of sectors such as:
– Consumer Goods
– Retail
– Food & Drink
– Packaging Material
– Pharmaceuticals and Cosmetics
And many more.
Why is the plastic tax being introduced?
First and foremost, the tax is being introduced to encourage businesses to switch to more sustainable and eco-friendly packaging. If you’re a business owner, you should be reviewing your plastic packaging use now, if you haven’t already.
Ultimately, the aim of the plastic packaging tax is to reduce the amount of plastic that we send to landfill. Instead, we should see more plastic being collected for recycling.
How To Prepare for the Plastic Packaging Tax (PPT)?
According to PWC, there are six key things you need to be considering right now:
– Assess the impact of the PPT on your business
– Assess your supply chains
– Start talking to your suppliers and customers about the PPT
– Review whether or not you comply with the PPT obligations
– Assign roles and responsibilities for meeting PPT compliance obligations
– Implement required changes to systems
You should also look for eco-friendly products that contain at least 30% recycled materials. For example, if your business transports goods using pallets, one of your biggest plastic products will be pallet wrap. Packaging companies such as Springpack have responded to the new Plastic Packaging Tax and have started stocking eco-friendly pallet wrap which contains 30% recycled content.
For retail brands who use a lot of bubble wrap, you might consider changing to more eco-friendly alternatives such as bubble wrap made from paper. Using paper material doesn’t just reduce your plastic packaging, it will completely replace it from this element of your packaging supplies.
Packaging Components
It’s important to consider all the different components of packaging for any given product. For example, something as simple as a bottle of water typically has three core components:
– The bottle itself
– A lid that screws onto the bottle
– A label that sticks onto the bottle
It’s not simply good enough for one single component to contain at least 30% recycled content. No, each individual component must comply. The bottle, the lid and the label. That’s why this packaging tax is so important to get on top of.
Is Anyone Exempt from the Plastic Packaging Tax?
As per the Government’s advice, the tax relates to businesses who manufacture or import 10 or more tonnes of finished plastic packaging components over 12 months. Therefore, small operators who don’t manufacture or import this volume of plastic will not need to pay the tax.
To Conclude
The Plastic Packaging Tax is due to take effect from 1 April 2022. If you haven’t got your act together on this one yet, you need to start doing so right now. The tax will be £200 per tonne and applies to plastic packaging with less than 30% recycled plastic manufactured in or imported into the UK. And the tax relates only to businesses who manufacture or import 10 or more tonnes of finished plastic packaging components over 12 months.
