Government confirms start date for plastic packaging tax
If you are a business that manufactures or imports plastic packaging, including if you import packaging which already contains goods, there are things you should do now to prepare for the tax.
A new plastic packaging tax will take effect from 1 April 2022 and will encourage the use of recycled rather than new plastic within plastic packaging. This will in turn stimulate increased levels of recycling and collection of plastic waste, diverting it away from landfills or incineration. Packaging should only contain recycled content where it is permitted to do so under other regulations, such as those covering food safety.
How the tax will operate
The tax will apply to plastic packaging manufactured in, or imported into, the UK where the plastic used in its manufacture is less than 30% recycled.
Consider using more recycled plastic
The tax is intended to encourage greater use of recycled plastic. You can start to make changes to the packaging you manufacture or import so that they include at least 30% recycled plastic. This means they will be outside of the tax. You will still need to keep records and may need to register in respect of the plastic packaging you manufacture and import.
Plan for changes to invoices
If you are responsible for accounting for the tax as the manufacturer or importer of plastic packaging, any invoice you issue to a business customer must show a statement that plastic packaging tax has been paid on the packaging concerned. This may require changes to your invoicing software, so you should start to prepare for this new requirement now.
Check if you will need to keep records
If you are a business that manufactures or imports plastic packaging, even if it is less than 10 tonnes a year, you will need to keep records of the packaging you manufacture or import. Plastic packaging is assumed to not meet the recycled content test unless it can be shown that it does.
If you are a business that manufactures or imports less than 10 tonnes of plastic packaging a year, we intend that the record-keeping requirements will be reduced, but you will still need to keep some records. Further information will be published later in the year.
Consider if you are exporting goods that are liable for the tax
If your goods are intended for export, you can defer paying the tax for up to 12 months from the point of manufacture or import. You will not have to pay the tax if the goods are exported within that 12-month period. You may also be able to credit the tax you have become liable for, where packaging is exported.