call us now.
01795 430 064
logo
HOW WE HELP
WE REDUCE PLASTIC
saving clients over half the plastic they need to safely wrap a pallet
Plastic tax

We’re all aware that the Plastic Packaging Tax, or the Plastic Tax as it’s most commonly known, goes live from April 2022, but what does it mean for your business when it comes to making the right decisions for pallet wrap? We take a quick look at a couple of approaches you could consider.

But first, here’s an overview of the plastic tax.

What is the plastic packaging tax?

The plastic tax is a government tax levied on the production or import of plastic with less than 30% recycled content.
Products containing 30% or more recycled content will be exempt from the plastic tax in April 2022.

How much is the tax?

The tax is 20p per kilo (£200 per tonne).

Depending on the product you buy - pallet wrap, top sheets, tape, strapping – the cost increase will be different.  Expect an approximate increase of 6-10% in the cost of the goods that do not have 30% or more recycled content.

How will it be charged?

The manufacturers and importers are charged directly by the government. Just like import duty and VAT. 

You will notice an extra line on invoices for plastic packaging after April 2022 showing the total weight of (non-exempt) plastic. This will be charged at 20p per kilo.

Is transit packaging exempt?

Transit packaging on products you import is exempt. i.e Whatever is being used to contain the pallet whilst in transit and storage – eg. the plastic strapping, tape and pallet wrap on those goods - will not be subject to plastic taxes in the UK. However, if you are purchasing transit packaging from a manufacturer or importer you will be paying the plastic tax to that supplier.

What effect will the plastic packaging tax have?

At present the vast majority of the pallet wrap products purchased do not contain 30% recycled content, so they will be liable to tax.

To find out exactly how much this will affect you based on your current level of spend and products used, email us at plastictax@packaginginnovations.co.uk.

We will reply with a breakdown of the tax liability if the packaging product choice and usage remains unchanged. We’ll also make sure to include some tips on how we tackle this to minimize or even completely remove your exposure.

Some implications - 3 key points

1. Clearly, no plastic packaging tax needs to be paid for pallet wrapping when using plastic film with more than 30% recycled plastic content.
BUT!
Using recycled plastic pallet wrap isn’t necessarily the best way forward. Here’s why.
When comparing a stretch film pallet wrap of 30%+ recycled content to a stretch film of no recycled content, it’s likely that more plastic wrap will need to be used to achieve the same pallet stability outcomes.
How can using more plastic [higher costs] be better for the planet or your profitability?

2. Something else to consider – Supply and demand

There isn’t enough recycled material available to support a mass shift to 30% recycled in the UK. If everyone switches suddenly to these products, the basic rules of supply and demand will kick in. Recycled raw material will increase in price and subsequently the 30% recycled products could actually become even more expensive.

3. So, all things considered, it may be the case that the best solution from a cost and an environmental perspective, is to pay the tax and use a film that wraps pallets with less plastic, to produce a lower cost per pallet.

What can be done to avoid any negative impacts?

Let’s consider a couple of different approaches

Option 1 – Reduce plastic

The most effective way to reduce exposure now, is to reduce plastic. This will have an immediate benefit of cost reduction as well as reducing exposure to the plastic packaging tax from April 2022.

This can be achieved by;

  • using different plastic films. Some are thinner and stronger
  • using wrapping automation (Funding this with a price/pallet wrapped avoids the need to invest in machinery)
  • learning more about adequate load stability

or a combination of all of these.

Option 2 – Use a film that contains 30% recycled material.

 

For some applications, using a stretch wrap film that contains 30% recycled material could have both a short-term and long-term benefit compared to the current films used.

If you are already using plastic-reducing stretch wrap films like Fiber Film or Nano film, moving to a 30% recycled product will increase both plastic consumption and cost in the short term.

The solution in this situation will be to consider thinner and stronger films to further reduce cost

Conclusion: Making sense of the situation

Every pallet wrapping situation is different. There’s no fixed formula nor guidelines to best manage the plastic packaging tax. Simply using film with 30% or more recycled content to avoid paying the tax could result in a lose-lose situation - More plastic and higher costs!
Clearly, there are many influences that determine the impact of the plastic packaging tax on what defines the right solution for your pallet wrapping operation. A lot depends on the type of film currently being used as to the direction you take next.

Contact us today to find out how we can help you to produce a pallet wrap win for your profit and the planet.

Call -+44- 1795 430 064
Email plastictax@packaginginnovations.co.uk
Contact form - https://packaginginnovations.co.uk/contact

About the author – Nathan Hutchinson

As founder and Managing Director of Packaging Innovations Limited, Nathan has been helping businesses in the UK to reduce plastic use in tertiary/transport packaging for more than a decade.  Nathan and the team at Packaging Innovations take a holistic perspective on producing a win for customers’ profitability and a win for the planet when it comes to making the right decisions on pallet stretch wrap.

CLOSED LOOP RECYCLING
Packaging Innovations is committed to sustainability and offers a range of recycled products
Plastic packaging tax

No doubt you’ve heard about the Plastic Packaging Tax or the Plastic Tax as it’s most commonly known. It’s going live next April. Let’s take a quick look at what it is and how it’s likely to affect your business from a transit / tertiary packaging perspective.

What is the plastic packaging tax?

The plastic tax is a government tax levied on the production or import of plastic with less than 30% recycled content.
Products containing 30% or more recycled content will be exempt from the plastic tax in April 2022.

How much is the tax?

The tax is 20p per kilo (£200 per tonne).
Depending on the product you buy - pallet wrap, top sheets, tape, strapping – the cost increase will be different.  Expect an approximate increase of 6-10% in the cost of the goods that do not have 30% or more recycled content.

How will it be charged?

The manufacturers and importers are charged directly by the government. Just like import duty and VAT. 

You will notice an extra line on invoices for plastic packaging after April 2022 showing the total weight of (non-exempt) plastic. This will be charged at 20p per kilo.

What does this all mean for users of transit/tertiary plastic packaging?

The Plastic Packaging Tax is an attempt to motivate us to use less new plastic and make the right decisions for our planet. That’s a genuinely positive intention. Let’s make it happen. It’s in our power to do this. 

Plastic pallet wrap of less than 30% recycled content that is in use, containing the contents of a loaded pallet, is exempt from the tax. It’s the new/unused rolls of plastic stretch wrap that are included in the tax.  So, there won’t be a charge for pallet wrap in use but there will be on the reels of wrap to be used to contain pallet loads in the future.

How does this influence making decisions on the right pallet stretch wrap to buy?

It's not as simple as switching to buying pallet wrap with more than 30% recycled plastic content to avoid paying the tax. There’s more to it. Here’s why.

Due to the stresses placed on stretch film, using recycled plastic pallet wrap isn’t necessarily the best way forward. When comparing a stretch film pallet wrap of 30%+ recycled content to a stretch film of no recycled content, it’s likely that more plastic wrap will need to be used to achieve the same pallet stability outcomes.

How can using more plastic be better for your profitability or the planet?

So what is the way forward?

The answer lies in re-evaluating a number of different types of pallet wrap stretch film to identify the sweet spot solution for each wrapping situation. We’ll cover this in the next article.

If you’d like to discuss this or any other issues surrounding the plastic packaging tax, please feel free to contact us.

There’s nothing like a little legislative encouragement to drive some positive change. Let’s embrace the Plastic Packaging Tax and the opportunity it presents to re-evaluate and identify the right pallet wrap specification to produce a win for profitability and the planet.

Watch out for more from us on how you can navigate the Plastic Packaging Tax and produce a better outcome for your business

Contact us today to discover how you can use less plastic pallet wrap and reduce costs – A win for-profit and the planet.

Call -+44- 1795 430 064
Email plastictax@packaginginnovations.co.uk
Contact form - https://packaginginnovations.co.uk/contact

About the author – Nathan Hutchinson

As founder and Managing Director of Packaging Innovations Limited, Nathan has been helping businesses in the UK to reduce plastic use in tertiary/transport packaging for more than a decade.  Nathan and the team at Packaging Innovations take a holistic perspective on producing a win for customers’ profitability and a win for the planet when it comes to making the right decisions on pallet stretch wrap.

How to reduce your plastic tax

Now, more than ever, it has become imperative to reduce your plastic. As a business, there’s now an even greater financial incentive to do so; in March the government introduced a plastic tax due to come into effect in 2022, and levied on plastic packaging that does not contain at least 30% recycled plastic. This can equate to as much as £200 per tonne – which, for companies who are already struggling from the impact of Covid-19, will be hard to manage. 

Luckily, there are ways to make sure that your plastic packaging complies with the 30% rule that the government has outlined, and Packaging Innovations can help. We’ve been taking steps to reduce the amount of plastic packaging our customers use since our inception in 2008, and we’ve learned a thing or two along the way. Here we’ll look at ways you can safeguard your company from the plastic tax. 

Reduce the amount of plastic you use

Answer honestly: how much plastic do you use to secure your pallets? It is estimated that 1.2 million tonnes of plastic film from packaging arises in the UK waste stream every year, a third of which comes from pre-consumer sources. It’s fair to say that plastic film is a leading contributor to business waste worldwide. Improving your efficiency in this – both in terms of the quantity of plastic you use, and what it’s made from – will go a long way towards reducing how much you’ll be taxed in future. 

Packaging Innovations offer a number of solutions for this, including a smart plastic film for its pallets which can drastically reduce your plastic use. As our name suggests, we’re constantly innovating, looking for new products which are good for our customers, and the planet. 
Learn more about our products

Use more recycled plastic

We recognise how useful plastic can be. It’s lightweight and efficient, and until a suitable alternative is found, it’s the best material we have to transport a range of goods from factories to consumers. By adopting a closed-loop recycling process, we’re able to produce plastic packaging for a range of uses – including stretch film, shrink films, pallet covers, box liners and even carrier bags – which are completely free from the plastic tax as they’re made from 30% recycled material. For you, this represents a very real cost saving in what you’d otherwise have to pay in plastic tax. 

So, what is closed-loop recycling and how does it work? In a nutshell, closed loop recycling allows us to use our clients’ waste plastic that would otherwise be thrown away and reuse it in our products, with no negative impact on the environment. Our fresh approach to recycling has futureproofed our business, and that of our clients, to allow us to offer a range of recycled plastic packaging that’s free from any current or future plastic tax. 
Learn more about closed-loop recycling


Want to find out more? Our consultants are ready, willing and able to help your business reduce your plastic, limit your exposure to plastic taxes and lower your costs now.



Take a look at how we approach projects with our clients and review some of our case studies.

,


“It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is most adaptable to change.”

Charles Darwin,


Embrace change and check out our latest innovations

,


If I had asked my customers what they needed in the 1920’s they would of said faster horses.

Henry Ford,

Case Study

Confectionery

Case Study

Animal Feed

Case Study

Food

Spend your
money wisely.

It is not so important how much 1kg of stretch and shrink wrap cost, it is more important how many pallets you can wrap with it.

We treat all of our clients as individuals, so the most important thing we do is listen. Then, through our years of experience, we can recommend the right stretch and shrink wrap solutions.

We're
listening.

What's the best
for you?

We have a full range of cutting edge products, which means we can be totally objective about our advice to you.

for each and every customer we aim to:

packaging

Improve your packaging

coins

reduce your costs

cogs

improve your production output

feet

reduce your carbon footprint

reduce

reduce your packaging waste tax

How?

We meet you face to face and understand what you are looking to achieve. Our sales team are fully trained and know how to get the best from your spend.

When?

Does next day work for you? We can offer next day delivery from any in stock products at our warehouses to virtually anywhere in the UK.

Key Product

The revolution in stretch wrap

fiber-film Find out more >

Key Product

the latest ergonomic innovation

xt-coreless-film Find out more >


our latest news



We’re all aware that the Plastic Packaging Tax, or the Plastic Tax as it’s most commonly known, goes live from April ... ”
see or read more