Treasury predicts 40% jump in recycled plastic use

11th March 2021 | Recycling

The use of recycled plastic in packaging will jump by an estimated 40% once the plastics packaging tax has been introduced in April 2022, the Treasury has predicted. The considerable boom in the recycled content of plastic packaging was forecast by the Treasury in a policy paper published last week in relation to Budget 2021.

It said legislation will be introduced in the Finance Bill 2021 to establish the tax, which will be set at £200 a tonne for packaging with less than 30% recycled content. Predicting what would be a substantial increase in the use of recycled plastic in packaging, the Treasury document stated: “The rationale of this tax aims to increase the use of recycled content in plastic packaging and it is estimated that as a result of the tax the use of recycled plastic in packaging could increase by around an estimated 40%. This is equal to carbon savings of nearly 200,000 tonnes in 2022 to 2023, based on current carbon factors.”

Recycled plastic

The document went on to say there was some uncertainty and that the policy could divert plastics from disposal. It noted: “Estimates of behaviour change have been noted as including a high degree of uncertainty by the OBR. The policy may also help to divert plastics from landfill or incineration, and drive recycling technologies within the UK.” The Finance Bill 2021 will set out how the levy will be collected, recovered and enforced, as well as the scope of the tax and who will be liable to pay the tax and need to register with HMRC.

“This is a new tax that will apply to plastic packaging manufactured in, or imported into the UK, that does not contain at least 30% recycled plastic. Plastic packaging is packaging that is predominantly plastic by weight,” the Treasury said. It’s hoped the tax “will provide a clear economic incentive for businesses to use recycled material in the manufacture of plastic packaging”, which will create greater demand for this material. “In turn this will stimulate increased levels of recycling and collection of plastic waste, diverting it away from landfill or incineration,” the Treasury added.

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