Now the plastic packaging tax has come into play from the first of April 2022 we as a packaging company wanted to inform you, our customer, about what this new plastic tax actually means for you and to answer the questions you may have on the subject. 

In summary: the plastic tax only really applies to manufacturers or importers in the UK. Most small businesses will be unaffected by this but may see a small increase in the cost of plastic packaging prices because of the tax.

What is the plastic tax?

• Came into effect on 1st April 2022
• Charged at £200 per tonne of finished plastic packaging.
• Only affects plastic packaging with less than 30% recycled component content.
• Applies to imported finished products and finished products manufactured in the UK. 
• Only need to register for the tax if you have imported or manufactured more than 10 tonnes of finished plastic packaging within the last 12 months. (to be calculated differently after 30th March 2023)
• Main aim is to provide economic incentive for businesses to use recycled materials in their plastic packaging and divert plastics from landfill and incineration. 

Who does the plastic packaging tax affect?

• Manufacturers - businesses who produce plastic packaging for import to the UK or manufacture in the UK.
• Importers- businesses that purchase plastic packaging finished products for import or from the UK.

What is considered recycled content? 

• The source of recycled products should be either post or pre consumer waste. I.e waste from the manufacturing process as well as waste generated by households, commercial, industrial or institutional facilities. 
• All plastic waste must be reprocessed through grinding, remelting, or regranulating to be considered recycled content. 

What products will be affected by the plastic tax?

Our products are affected on a supplier by supplier basis and after conducting research into our primary manufacturers the vast majority of our product range remains unaffected. 

Below is a list of our products likely to be affected by the plastic packaging tax: 

• Packaging tapes
• Polythene bags
• Stretchfilms e.g clingfilm 
• Bubble wrap
• Resealable bags
• Bin liners
• Florist film
• Fruit nets 
• Clear boxes 
• Astrofoam
• White carrier bags 
• Clear faced bags

Products made up of multiple components but containing more plastic by weight than the other components will also be categorised as a plastic packaging taxed product. 

What exemptions are there?

•  Human Medicine packaging
• Transport packaging used to import multiple goods safely to the UK.
• Packaging for use in aircraft, ship or rail goods stores.

How will it affect my small business? Will I be charged more? 

• Only importers or manufacturers pay the tax - for us and our customers the tax will only manifest as increased unit costs where applicable. 
• Mainly measured by weight of plastic in finished packaging products.
• In the event that a product you purchase from us is affected by the tax it will likely be around a 10p increase per kilo of plastic sold. 

Roundup 

To break this down - Materials make up roughly 50% of the price of the purchase cost of our products and the tax is based on weight of materials. When buying 2 tonnes of plastic packaging with a £200.00 price increase - this equates to a 10p increase per 1kg of plastic packaging sold. 

To put this into perspective let's take our bubble wrap which is likely to be affected as an example. If you were to buy x1 of our largest rolls which currently costs £61.51 inc VAT and this weighs approximately 6kg which means the additional plastic packaging tax cost would equate to approximately £0.60p extra.  In many cases we will also be absorbing this additional cost and not passing this onto our customers. 
 
All in all the plastic packaging tax isn’t something for our customers to worry about too much and is a minor inflation on a very select number of products. The tax primarily affects manufacturers and importers to the UK who are importing large volumes of plastic packaging and as we solely purchase from UK based businesses, many of which are absorbing the price increase, our cost prices are not likely to be hugely affected if at all.

If you were to compare the cost difference to other factors that have affected the cost of products such as crude oil, transport and availability factors the plastic packaging tax is miniscule in comparison. 

We are always aiming to improve our eco-friendly packaging offering and where we can and where it is feasible for the product type, we will be investing in more sustainable alternatives to plastic packaging. 

Of course as it currently stands plastic packaging still has its place in our product offering for certain types of products, especially within our food safe ranges, which means there sometimes isn’t a viable alternative to utilising plastic components within our packaging. So until a viable option becomes available at the right cost a certain amount of plastic products will remain within our ranges, but you can rest assured that we are constantly monitoring this on a per product basis.

Like this article? Check out our Plastic Packaging Alternatives article for more information.