New tax! UK to super implement plastic packaging tax from April 2022

Plastic restriction and ban have long been an important measure in the process of promoting sustainable development globally, and have also become a policy trend of various countries. Following the EU's implementation of the plastic tax, the UK has also issued a new tax - the plastic packaging tax. For plastic packaging produced in the UK or imported into the UK. The resolution has been legislated in the Finance Bill 2021.

From 1 April 2022, the UK will levy a plastic packaging tax of £200 per tonne for plastic packaging manufactured or imported into the UK in excess of 10 tonnes each year and using less than 30% of recycled plastic.

In addition, the United Kingdom has regulations on whether to use this tax on packaging, and even if consumers need to buy and use disposable plastic packaging, they need to levy plastic packaging tax.

In terms of composite packaging, if plastic is used in the highest proportion of the packaging varieties, all of them are regarded as plastic packaging, and plastic packaging tax needs to be levied. If not, the tax is not levied.

The tax applies to finished plastic packaging manufactured in the UK or imported into the UK if the plastic used is less than 30% recycled by weight.

Where the plastic recycling rate is less than 30%, the tax rate payable is £200 per metric ton, payable by the producer/importer.

Businesses are obliged to register and keep records from the moment they import or manufacture plastic packaging of 10 tons or more, and may need to register even if they do not have to pay taxes, depending on whether they fall below the 30% recycled content threshold .

However, producers and importers of a small amount of plastic packaging will receive tax exemptions, such as the following three categories, regardless of the proportion of recycled materials used, enjoy tax exemption:

1. The primary function of packaging is storage, not packaging. For example: tool box, first aid kit, earphone or earplug box, etc.

2. Packaging is an integral part of the product. For example: water cartridge filters, printers, toner or dental floss boxes, etc.

3. Designed to display merchandise. Including: commodity shelves, commodity display stands, etc.

In addition, although these four types are within the scope of taxation, they will be specially exempted by law, including:

1. Packaging used in the process of importing goods into the UK, such as containers, pallets, etc.;

2. Own packaging of pharmaceutical products;

3. Packaging used for international transportation in aviation, railway and maritime fields;

4. Permanent use is not for the purpose of containing, protecting, handling, delivering or displaying goods.

According to the British General Administration of Customs, the plastic packaging tax is levied to improve the level of recycling and collection of plastic waste, and also to supervise and promote the control of plastic products by exporters.

In addition, although these four types are within the scope of taxation, they will be specially exempted by law, including:

1. Packaging used in the process of importing goods into the UK, such as containers, pallets, etc.;

2. Own packaging of pharmaceutical products;

3. Packaging used for international transportation in aviation, railway and maritime fields;

4. Permanent use is not for the purpose of containing, protecting, handling, delivering or displaying goods.

                                                                                                                                                                     AHCT GROUP  01/2022