HomePlastic Tax Reports

Plastic Tax Reports

Addressing Global Plastic Waste

The importance of addressing plastic pollution has expanded to a global, regional, and national extent. In a consequential move, 175 United Nations (UN) member states, during the fifth session of the UN Environment Assembly on 2 March 2022, resolved to work about an international agreement by the close of 2024. Purpose of countering plastic waste and pollution, this prospective “plastic treaty” – championed by outstanding plastic producers like the United States and China – will focus on plastic’s entire lifecycle: from production and design to disposal, with the mission of minimizing plastic waste.

Europe's Answer to Plastic Waste

Europe, with its intense awareness of plastic waste challenges, has been proactive in its policy response. The European Union (EU) begun a unique “plastic levy” effective from 1 January 2021. Based on non-recycled plastic packaging waste, this duty is to reduce its excessive spread, while at the same time supporting the 2021-2027 EU budget, specifically considering fierce COVID-19 related disbursements.

Each EU member state’s levy is calculated by applying a rate of EUR 0.80 per kilogram to the weight of non-recycled plastic packaging waste. To financialization these payments, while some states utilize their national budgets, others are either introducing fresh taxations or growing existing ones on plastic products. Moreover, several non-EU European nations are innovatively conflicting plastic product usage, struggle for reduced plastic waste and the acceptance of a circular economic model.

Plastic Taxation in the EU:
Navigating Diverse Financing Methods

EU Member States have diverse strategies for financing the EU Plastic Levy:

National Budgets:

Direct payment from the state’s reserves.

New Plastic Taxations:

Introducing fresh taxes, charges, or contributions on plastic commodities.

Extending Current Schemes:

Broadening the scope of current taxation systems to cover a further range of plastic products.

RTC Suite: Navigating Plastic Tax Reporting with Precision

Extensive Database

Obtain access to updated data on plastic tax regimes across countries.

Efficient Reporting

Automated tools will help you provide accurate and timely reporting.

Expert Consultation

Collaborate with our specialists for customized guidance.

What is Plastic Tax?  

The Plastic Tax is an innovative environmental levy aimed at reducing plastic waste. It targets the production and import of plastic packaging, especially those materials lacking significant recycled content. By setting a minimum threshold of 30% recycled material for plastic packaging, the tax encourages businesses to rethink their packaging strategies, promoting a shift towards more sustainable and eco-friendly options.

How Does Plastic Tax Work? 

The mechanics of the Plastic Tax are straightforward yet impactful. Manufacturers and importers of plastic packaging are required to pay a tax if their products contain less than 30% recycled content. This threshold serves as a benchmark, encouraging companies to either increase the recycled content in their packaging or face the financial implications of the tax. It’s designed to be a compelling motivator for companies to align their practices with environmental standards.

Who Pays the Plastic Packaging Tax? 

The Plastic Packaging Tax is levied on businesses engaged in the manufacturing or importing of plastic packaging. These businesses are required to assess the composition of their packaging materials and ensure compliance with the tax regulations. Failure to adhere to these requirements can lead to financial penalties, making it imperative for businesses to adapt and contribute to the environmental cause.

Plastic Packaging Tax Reporting Requirements

For compliance with the Plastic Packaging Tax, affected businesses must maintain detailed records and provide regular reports on their plastic packaging. These reports should include information on the total weight of the plastic packaging produced or imported, the proportion of recycled content, and any efforts made to increase this proportion. Accurate reporting not only ensures compliance but also reflects a company’s commitment to environmental stewardship and responsible business practices.

Why is the Plastic Tax being implemented in the U.K.?

In the United Kingdom, the Plastic Tax is being rolled out as a strategic response to the escalating environmental concerns related to plastic waste. This tax forms part of a broader initiative to protect the environment by discouraging the use of single-use plastics and promoting recycling. The government aims to incentivize businesses to incorporate more recycled materials, thus reducing the carbon footprint and environmental impact associated with plastic production and disposal.

Who is subject to pay according to the new plastic tax?

Under the new plastic tax regulations, the primary responsibility falls on manufacturers and importers of plastic packaging in the U.K. This encompasses a wide range of businesses, from large corporations to medium-sized enterprises, that produce or import plastic packaging as part of their operations. The tax aims to make these businesses key players in the transition towards more sustainable packaging solutions.

Who will be obligated for the Plastic Packaging Tax? 

The obligation to pay the Plastic Packaging Tax is specifically aimed at businesses dealing with significant volumes of plastic packaging – those producing or importing more than 10 tonnes of plastic packaging annually. This threshold ensures that the tax doesn’t place an undue burden on small businesses while holding larger, more impactful companies accountable for their environmental responsibilities.

Talk to Our Experts

Book a one-on-one session with our experienced team for personalized guidance on shaping your Tax Technology platform strategy.

Our Solutions

A comprehensive suite for e-Documents, VAT Reports and Reconciliation