What is the EU plastic tax Levy that’s being introduced in Jan 2021?

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In July the EU finally approved the implementation of a new plastic tax levy from January 1st 2021.  Whilst it’s called a “tax”, strictly speaking, it’s a direct charge to member states by the EU. The money generated will go towards an EU Coronavirus recovery fund.

The levy focuses on plastic material that is non-recyclable.

Each member state is required to pay €800 per tonne of non-recyclable plastic used.  Individual country contributions will be calculated based on their own national waste database figures.

How each state recoups this cost will be at its own discretion, but it’s suspected that many of the member state producers will be subject to taxation by their own governments.

There is an expectation that prices for non-recyclable material will rise as a result of this.

How this will affect UK businesses

Whilst the UK will not be subject to this member state payment, it will have a knock-on effect to those businesses that import plastic packaging from Europe.   Prices may well rise.

How the EU tax levy is different to the proposed UK plastic tax

This EU levy places a focus on non-recyclable plastics, pinning pressure on the industry to consider waste reduction at product end of life.

The proposed UK taxation, to be introduced in April 2022, places the focus on “non-recycled content plastic”, with taxation being implemented on material that contains less than 30% recycled content.  This is hoped to stimulate the recycling industry through creating demand for recycled material.

You can read more about the proposed UK plastic tax and how you might minimise your exposure here.

If you are looking for help and advice on your plastic packaging, why not contact Macfarlane Packaging today? Our team of packaging experts are here to help.

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