Government announces new plastic tax, but scraps latte levy

30th October 2018

The Government announced yesterday in the Budget plans for a new tax on plastic packaging which contains less than 30% recycled plastic, subject to consultation. 
 
What was announced?

1. To reduce the problem of excessive and environmentally harmful plastic packaging, and incentivise manufacturers to use recycled plastic, the government will introduce a tax on the production and import of plastic packaging from April 2022. Subject to consultation, this tax will apply to plastic packaging which does not contain at least 30% recycled plastic, to transform financial incentives for manufacturers to produce more sustainable packaging. The tax will work alongside the reform of the Packaging Producer Responsibility system, which will aim to increase producer responsibility for the costs of their packaging waste, including plastic. This system will provide an incentive for producers to design packaging that is easier to recycle and penalise the use of difficult to recycle packaging, such as black plastics. To ensure a coherent approach, the government will consult on both of these together in the coming months. Future revenues raised from these measures will enable investment to address single-use plastic, waste and litter to meet the government’s ambitions for resources and waste.
2. The government has also announced £20m new funding to tackle plastics and boost recycling: £10 million more for plastics R&D and £10 million to pioneer innovative approaches to boosting recycling and reducing litter, such as smartbins. This is in addition to the £20m for plastics R&D through the Plastics Innovation Fund announced in March 2018.
3. The government recognises the important role incineration currently plays in waste management in the UK, and expects this to continue. However, in the long term the government wants to maximise the amount of waste sent to recycling instead of incineration and landfill. Should wider policies not deliver the government’s waste ambitions in the future, it will consider the introduction of a tax on the incineration of waste, in conjunction with landfill tax, taking account of the possible impacts on local authorities.
4. The government recognises the problems caused by disposable cups, which are difficult to recycle and often littered. The government has concluded that a levy on all cups would not at this time be effective in encouraging widespread reuse. Businesses are already taking steps to limit their environmental impact, but the government expects industry to go further and will return to the issue if sufficient progress is not made. In the meantime, the government will look in the Resources and Waste Strategy at the best way to tackle the environmental impact of cups.”

The EAUC was pleased to see some of these measures, and it is certainly a step in the right direction - but it isn't the step change needed. We were disappointed to see that a latte levy was not deemed as necessary at this time.

We will be responding to the consultation on the plastics in due course and if you would like to participate, please email rsaban@eauc.org.uk.

More info: https://www.gov.uk/government/publications/budget-2018-documents