Skip to main content

UK Plastic Packaging Tax Becomes Effective April 2022

Plastic water bottles

A new tax on plastic packaging in the United Kingdom (UK) will become effective on April 1, 2022. The tax will apply to plastic packaging components that do not contain at least 30% recycled plastic and that are either manufactured in the UK or imported into the UK (although there are certain exemptions to the tax). 

Manufacturers and importers of plastic packaging components of 10 or more tonnes (1 tonne equals 2,205 pounds) over a 12-month period are required to register for the tax, which will be levied at a rate of £200 per metric tonne. Plastics subject to the tax include polymers that are biodegradable, compostable, and oxo-degradable. In addition, packaging components made from multiple materials which contain more plastic by weight than any other substance will be classified as plastic packaging components for the purposes of the tax. Recycled plastic is defined as plastic that has been reprocessed from recovered material by using a chemical or manufacturing process, other than organic recycling, so that it can be used either for its original purpose or for other purposes.

Manufacturers and importers that are registered for the Plastic Packaging Tax are required to keep records to support the information submitted in quarterly tax returns. The records must include a breakdown of the weight of plastic packaging components finished or imported in each period, among other information. In order to claim the exemption for plastic packaging components containing recycled plastic, records must provide sufficient supporting evidence that recycled plastic was used and confirm the source of the recycled plastic. Plastic packaging intended to be exported from the UK within 12 months of its manufacturing or import into the UK is exempt from the Plastic Packaging Tax.

The UK government has issued a guidance with examples of both packaging within and outside the scope of the Plastic Packaging Tax. Also, the HM Revenue and Customers has prepared a guidance document on how to make due diligence checks for plastic packaging tax (published on December 30, 2021).  Indeed, this document recommends that due diligence checks be conducted by the manufacturer but also by the importer and purchaser of plastic packaging components to lessen the risk of being involved in a supply chain where plastic packaging tax is unpaid. Other guidance documents on the tax, including one on record keeping requirements, can be accessed from the UK government website.