UK Plastics Tax finds favor with waste industry as consultation closes

24 Aug 2020 --- Leading UK waste management authorities including Veolia, the Environmental Services Association (ESA) and the National Association of Waste Disposal Officers (NAWDO) have offered support for the proposed UK Plastics Tax as the consultation period concludes. The UK government proposed a £200 (US$263) per ton tax rate for plastic packaging with less than 30 percent recycled content that will take effect from April 2022. However, with support from the UK trade body Bio-based and Biodegradable Industries Association (BBIA), compostable packaging specialist TIPA has called for compostable solutions to be excluded from the levy and afforded greater systematic inclusion in overall waste management strategy.

The Plastics Tax is designed to provide a clear economic incentive for businesses to use recycled material in plastics packaging. The increased incorporation of recycled plastics into packaging will drive demand and stimulate increased recycling and collection of plastic waste, diverting it away from landfill or incineration.

The UK government announced in April that it had extended the Plastics Tax consultation from May 20 to August 20 due to COVID-19 disruptions. The draft legislation set out the following key features:

• The £200 (US$263) per ton tax rate for packaging with less than 30 percent recycled plastic;
• The scope of the tax by definition of the type of taxable product and recycled content;
• The exemption for producers and importers of small quantities of plastic packaging;
• Who will be liable to pay the tax and need to register with HM Revenue & Customs (HMRC);
• How the tax will be collected, recovered and enforced.

Industry advises effective implementation
Tim Duret, Technology and Organics Director, Veolia UK and Ireland, described the tax as “the key that the country needs to unlock the next step towards meeting its targets and becoming truly sustainable.” Likewise, Jacob Hayler, Executive Director of ESA, explained that the sector is “ready to push the button on significant further investment in domestic plastic recycling and reprocessing infrastructure, which will create new circular economy jobs.” NAWDO agrees that the proposed tax signifies “an important and most welcome change in approach from the government.”The UK government proposed a £200 (US$263) per ton tax rate for plastic packaging with less than 30 percent recycled content that will take effect from April 2022.

The first step for Duret is to deliver on the inclusion of recycled content in new packaging. “What is fundamental is implementing a strong financial driver on reuse and recycled content, and to ensure that the system is changed to allow real eco-design to commence. If done right, this is exactly what the Plastics Packaging Tax will offer,” he notes.

Veolia is continually investing in plastics recycling, elevating its technologies to optimize processes. When recycled properly, plastics can provide the lowest carbon emissions of available packaging materials, according to a new report commissioned by the waste management specialist.

“Plastic is not the enemy – disposal or loss in the environment is, and we should set up suitable recycling schemes around the world. There is no target group to blame. Everyone has a responsibility to adopt part of the solution. Consumers, manufacturers, local authorities and waste companies all need to do their bit in this supply chain,” Richard Kirkman, Chief Technology and Innovation Officer, Veolia UK and Ireland, tells PackagingInsights.

Meanwhile, Duret urges those responsible for the final design of the Plastics Tax to heed the warnings from multiple sectors and avoid loopholes or unintended consequences that may drive packaging towards hard-to-recycle materials or packaging formats – diminishing or reversing the net environmental benefit of the tax.

“Although the country’s economic outlook is uncertain as a result of the COVID-19 crisis, we would urge HMRC to stay the course in both the ambition and implementation of the Plastics Tax. To water down the detail, or to delay implementation, would be costly to the UK’s long-term sustainability goals and the achievement of our national recycling targets, and will be contradictory to the pursuit of a ‘green recovery’ from the crisis,” Duret explains.Plastics can provide the lowest carbon emissions of available packaging materials, according to a Veolia-commissioned report.

Moreover, NAWDO challenged the government to review the tax within three years of its implementation. “This is to firstly ensure it has the desired effect; secondly to see what possible synergies might be realized between the management of the tax and the frameworks that will be set up to manage Extended Producer Responsibility and Deposit Return Schemes; and thirdly to look for other opportunities for similar approaches in other areas,” the association says. It would like to see the tax extended to all plastic produce, including furniture, mattresses and textiles, both domestic and import.

Biffa also advocates for the tax, favoring its effects in driving high-quality plastic recycling. “The levy complements our wider strategy to invest in UK plastic recycling facilities and create a more circular economy,” the waste management company comments.

Compostable considerations
Not all corners of the industry are satisfied with the levy. Compostable packaging supplier TIPA claims the proposed Plastic Packaging Tax “falls short” in stemming the growing tide of plastic pollution. “Traditional recycling alone is failing to deal with the millions of tons of plastic detritus on our planet and there is no foreseeable change to this without systematic change in the materials we employ, including compostables,” the company wrote in a letter to the UK Treasury.

UK trade body BBIA backed TIPA’s call for action. The response follows the publication of “Breaking the Plastic Wave,” a report by the Pew Charitable Trusts and SYSTEMIQ, which endorsed compostable packaging as part of the solution for cutting 80 percent of the plastics otherwise headed for the ocean by 2040.A TIPA-commissioned poll found that 85 percent of UK consumers believe more compostable packaging should be used to wrap food as an alternative to plastic. Shown here: TIPACLEAR – a compostable alternative to conventional flexible plastic (Image Credit: TIPA).

TIPA, whose compostable materials are used by Waitrose and Ocado, stresses that the UK has “no capacity for flexible food packaging recycling.” In July, a TIPA-commissioned Populus national poll found that 85 percent of UK consumers believe more compostable packaging should be used to wrap food as an alternative to plastic. In March 2020, a separate poll by Survation revealed that 98 percent of MPs believe compostable packaging alternatives can be part of the plastic crisis solution.

“It is now well documented that a failure to stem the ever-growing tide of plastic waste is irreparably damaging our oceans, wildlife, natural areas, and personal health,” notes Daphna Nissenbaum, World Economic Forum Technology Pioneer, CEO and Co-Founder of TIPA.

“Expert evidence and public opinion align in saying that each plastic stream must immediately adapt its solution. Compostable materials – which have grown in their capability to provide a real replacement for flexible plastic packaging – can fully decompose and return to the earth with the food it packages.”

“If the plastic tax’s objective is to reduce harmful plastic pollution and to encourage green alternatives, it falls short of doing this by taxing compostable materials in the same way as virgin plastic,” Nissenbaum concludes.

By Joshua Poole