The Plastic Packaging Tax came into force on 1 April 2022 and affects an estimated 20,000 businesses across a broad range of sectors.
A recent Freedom of Information request[i] from packaging manufacturer and consultancy Duo showed the tax was on course to beat its first-year target, generating over £200m in revenue and exceeding the HMRC first-year target by more than £30 million.
But A Plastic Planet says “far from being a sign of success, this shows that the tax has failed to deter the use of virgin plastics. You only pay the tax if you don’t meet the recycled content percentage so there‘s nothing to celebrate when thousands of businesses clearly prefer to continue using virgin plastic and just pay the tax.”
The levy is charged at £200 per tonne of plastic produced where less than 30% is recycled content. In a letter to Chancellor Jeremy Hunt, A Plastic Planet today proposes that the tax be increased to £400 a tonne and the threshold of recycled content be increased to 50%.
“If the plastic manufacturers want to prove that there is any level of circularity in plastic, then let’s have a recycled content percentage that is meaningful”, Sutherland added.
An additional 6 million metric tons of waste was generated in 2021 compared to 2019, this still almost entirely made from fossil fuel-based “virgin” feedstocks[ii] according to a recent report from the Minderoo Foundation.
A Plastic Planet also calls for an independent auditing regime to ensure plastic producers are held to account. “One tenth of Plastic Packaging Tax returns should be independently audited each year for the next three years, to entrench compliance in the system.”, she said.
A revised scope for the tax is also proposed to ensure ‘climate negative’ chemical recycling practices do not enable producers to avoid the tax. A Plastic Planet also supports recommendations from the House of Commons EFRA Select Committee which asked ministers last year to ringfence revenue from the Plastic Packaging Tax for reinvestment in recycling and composting infrastructure.
Sian Sutherland, Co-Founder and Chief of A Plastic Planet & Plastic Free said:
“Getting the world’s first plastic packaging tax was a big win for campaigners but the devil is always in the detail.
“In practice, the tax just isn’t doing its job in deterring virgin plastic production. The rate is too low and thresholds are too generous. And the system allows plastic producers to ‘mark their own homework’ – to that extent paying the tax is essentially voluntary.
“Having put the tax in place, the government should now be brave enough to give it real teeth. Its clear objective should be to stop the production and importation of virgin plastics in the UK, not to raise excess revenues from continued ‘business as usual’ by the plastic giants.”
A Plastic Planet is a global solutions organisation. It has one goal – to ignite and inspire the world to turn off the plastic tap
[i] https://www.circularonline.co.uk/news/plastic-packaging-tax-on-course-to-beat-first-year-target/