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Plastic packaging tax

8th April 2021

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.