The UK’s plastic packaging tax
Have you explored all the options available to mitigate or minimise the impact of the plastic tax on your business?
What is the plastic packaging tax?
The plastic packaging tax was implemented by the UK government in April 2022. A tax of £210.82 per metric tonne is now enforced for all plastic packaging components that do not contain at least 30% recycled material.
The plastic packaging tax applies to plastic packaging produced in or imported into the UK that does not contain at least 30% recycled plastic. Packaging that contains at least 30% recycled plastic, or any packaging which is not predominantly plastic by weight, is exempt from the tax.
Packaging which is imported into the UK is also liable for the tax, whether the packaging is unfilled or filled. In the current climate, where brands and retailers are trying to move packaging lines over to recyclable solutions, it can present a significant challenge to also incorporate PCR content into the material.
How much is the plastic packaging tax?
The plastic packaging tax is £210.82 per metric tonne of packaging with less than 30% recycled plastic.
Who pays the plastic packaging tax?
The tax applies to all plastic packaging manufactured or imported and placed on the UK market, alongside transport or tertiary packaging used in the export of goods.
The tax is paid by the person who produces the finished plastic packaging component or the importer of this finished component.
When do I register for the plastic tax?
You must notify HMRC of your liability to register for the Plastic Packaging Tax if your business meets either of the following conditions:
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At any time after 1 April 2022, you expect to manufacture or import at least ten metric tonnes of plastic packaging in the following 30 days (registration must occur within 30 days of the first day that this condition is met)
Example: on 15 July you accept an order to manufacture 18 tonnes of plastic packaging by 31 July – you would be liable to be registered for the tax from 15 July and would need to register by 14 August
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You have manufactured or imported at least ten metric tonnes of plastic packaging in a 12-month period ending on the last day of a calendar month – you become liable for the Plastic Packaging Tax from the first day of the next month and must register by the first day of the subsequent month.
What are the exemptions from the plastic packaging tax?
There are some exemptions to the plastic packaging tax, these are;
- Cellulose
- Plastic packaging manufactured or imported for use in the immediate packaging of a medicinal product
- Transport packaging used on imported goods
- Packaging used as aircraft, ship and rail stores
- Components that are permanently designated or set aside for use other than a packaging use
There is also a deferral of liability to the tax for plastic packaging which is exported that meets the direct export condition.
Plastic packaging which contains at least 30% recycled plastic or is exempt from the tax for other reasons must still be included in working out if a business must register for the tax. Get in touch to discuss how Constantia FFP can help you to minimise the impact of the Plastic Tax on your business.
Is packaging that contains multiple materials liable for the tax?
Packaging that contains multiple materials but contains more plastic by weight than any other single substance will be a plastic packaging component for the purposes of the tax.
For example, if a 10 gram item of packaging is made of 4 grams of plastic, 3 grams of aluminium and 3 grams of cardboard, all 10 grams will be considered plastic packaging for the purposes of this tax.
Likewise, if the 10 gram item was 3 grams of plastic, 4 grams of aluminium and 3 grams of cardboard, none of the item would be taxable. If the weight of plastic in the component is equal to the weight of another single material used, the component would not be considered as plastic for this tax.
How can Constantia FFP help?
Constantia FFP have a number of solutions that can support you in mitigating the tax in its entirety or minimising your exposure. At Constantia FFP we understand there are many challenges with regard to producing food safe packaging with PCR content and in many cases it will not be possible to achieve both a recyclable solution and include PCR content.
There are many factors to be considered including cost, functionality, availability and business objectives. Constantia FFP’s technical expertise and manufacturing capability puts us in an optimal position to drive the innovation of more sustainable flexible packaging solutions and we can support you on your journey to find solutions.
View Exempt Packaging Reduce Your Tax
Exempt Products
Esterseal
A recyclable solution available with 30% PCR content
Constantia FFP’s Esterseal recyclable lidding film ticks all the boxes, allowing business to move forward on their sustainable packaging journey whilst still meeting the requirements for exemption of the Plastic Tax. Esterseal is a resealable lidding film that has been classified as ‘Recycle’ by OPRL and can be collected at kerbside. It is also available with 30% PCR content to mitigate the Plastic Packaging Tax.
Esterseal lends itself perfectly to many categories within the food sector as it can be used on both pre-formed and thermoformed trays and can run easily on existing lines without the need for costly upgrades and without impacting on manufacturing speeds.
Options available to mitigate the Plastic Packaging Tax
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Lidding Film
Since 2010 Constantia FFP have been offering lidding film containing 30% post-consumer recycled (PCR) content. The recyclate used in the film is sourced from PET bottle deposit return schemes and the resulting material is fully approved for food contact.
Options available to mitigate the Plastic Packaging Tax
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Ovenable Packaging
Constantia FFP have led the field in ovenable packaging, putting the first fully printed ovenable bag on supermarket shelves. Estercook was launched in 2013 and has since driven innovation in the sector, lifting sales and providing outstanding convenience for consumers.
Today, Constantia FFP once again lead the way in innovation and can offer Estercook with 30% Post Consumer Recycled Content.
This is not only provides a tax-exempt product but offers a fantastic finish to help your product stand out on shelves with fully printed packaging.
Options available to mitigate the Plastic Packaging Tax
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Minimise the impact of the Tax
Constantia FFP have been providing innovative flexible packaging solutions for over 55 years and our technical team will provide expert advice and run trials onsite to ensure all specifications are fit for purpose.
Pre-made Bags and Pouches
With two on-site pouch making machines at our Northamptonshire facility, Constantia FFP can offer a full range of pouches and bags, including stand-up pouches, two or three sided seal flat bags and four sided seal bags with gusset, for all market sectors.
Pouches & Bags offer an ideal, lightweight packaging solution to many products. Switching to a lightweight plastic solution can immediately reduce the cost of the Packaging Tax. Constantia FFP can provide technical expertise and advice on specifications and laminate structures that will further minimise the cost of the Plastic Packaging Tax for your business.
Film on a Reel
Our film on a reel will run on Horizontal Form Fill Seal Machines (HFFS) and Vertical Form Fill Seal Machine (VFFS) to produce the final packaging format you require such as, pillow packs, sachets, pouches, and stabilo packs with sealing methods such as ‘fin seal’ or ‘lap seal’.
We can work with you to find laminate structures that offer the functionality you need to meet your product requirements whilst either minimising or in some cases mitigating the Plastic Packaging Tax.
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