The UK government will be introducing a tax for plastic packaging produced in, or imported into the UK that doesn’t contain at least 30% recycled plastic. Many businesses have already begun to switch to paper alternatives in preparation for the plastic tax that begins in 2022 and there are multiple factors to why you should be preparing or taking action now.

Why is this important to your business?

The new tax is estimated to affect over 20,000 producers and importers of plastic packaging and is predicted to have the largest impact in the waste and recycling sector since landfill tax was first introduced. It has also been said that it will make a huge impact on business customers of producers & importers and consumers who buy goods in plastic packaging in the UK.

Government Website “The tax will provide a clear economic incentive for businesses to use recycled material in the production of plastic packaging, which will create greater demand for this material and in turn stimulate increased levels of recycling and collection of plastic waste, diverting it away from landfill or incineration.”

We are all aware of the issues revolving around plastic packaging and the environment, the governments new tax will definitely make a difference to the future of our planet.

If you tick any of the boxes for the new tax – now is the time to act. Here are some key points to why you need to make the changes sooner rather than later:

• Protecting the Environment, this is an obvious global concern and switching to a paper alternative will help protect the future of our planet.
• Saving on costs, paper packaging that is packed smartly can actually save you money, especially taking into account the new tax.
• No need for sacrifice, Switching to paper packaging does not mean sacrificing on performance, costs or speed
• Time is of the essence, Implementing and training packers on a new solution can be time consuming, don’t get caught out at the last minute and start preparing now.

What will the plastic packaging tax cost your business?

From April 2022, businesses who have liability under the tax will need to submit data to HMRC each quarter covering the tonnage of liable packaging manufactured or imported, information around any exempt packaging and evidence of where the recycled content exceeds 30%. The business must then also pay the £200 per tonne applicable to liable packaging they have imported or manufactured.

Where material which has had the tax paid on it is subsequently exported, a rebate will apply to the business who first paid the tax. Where export takes place in the same quarter as material is reported, HMRC plans to allow businesses to net the export value from their submission for that quarter.

The tax is not ring-fenced or intended to be set aside for recycling/waste management purposes. All funds generated will be returned to the central government fund. This is a move mirrored somewhat by the EU’s Plastic Packaging Levy, which targets non-recycled plastics with the specific aim of recuperating the costs of Covid-19 measures.

The tax will run alongside, rather than as a replacement to, the Producer Responsibility (Packaging Waste) regulations. This means that the cost of this tax will be additional to any PRN obligations producers incur, it is likely that if you do fall under the category that you will see a jump in costs.

Don’t rush your decision!

Switching packaging supplier can feel like a daunting task, especially for your operations department. That’s why we are urging businesses to start planning now to avoid a rushed decision at the beginning of 2022, not only will packaging suppliers be extremely busy dealing with the packaging tax – they will also be getting a mass amount of requests from businesses looking to switch to eco-friendly alternative packaging.

Test Valley Packaging have noticed a recent spike in enquiries to make the switch to paper packaging and we anticipate this will continue to increase throughout 2021 and early 2022. It may seem that switching to sustainable packaging with your current supplier is the simpler choice, but you should be looking out for price increases, over-packing products with paper and how sustainable the products actually are, such as the source of the paper or if they are providing ‘sustainable’ plastics.

How can Test Valley Packaging help you make the switch?

Here at Test Valley Packaging, we thrive in delivering a smooth, speedy and efficient delivery of products, services and transitions – whether businesses are making a simple plastic to paper packaging switch or a full installation for an integrated packing area. We have helped many businesses make the switch to sustainable packaging, saving on costs, reducing breakages by up to 50%, packing speeds and increasing overall efficiency within operations. 

We provide in-depth training on all of our products to ensure you are using the correct amount of packaging for your products in the most efficient and cost effective way. As described in this blog from one of our sister companies here, it’s not all about making the switch. To gain the ‘eco-friendly’ label you also need to make sure you are using the techniques required to reduce your packaging usage in general.

To get you started with your plan to switch to eco-friendly packaging, you can get in touch with our sustainability experts who can provide a free virtual demonstration of the industry leading paper products that are available and discuss costs, implementation plans & present to you our latest work – including examples of how we helped some of the UKs largest retailers improve their overall packaging solution.

sales@testvalleypkg.co.uk | 01722 414800