Which packaging is subject to plastic packaging tax in the UK?
Which packaging is subject to plastic packaging tax in the UK? .
What classifies as plastic or recycled plastic? Is the packaging you produce or import taxable from the UK?
Which plastic packaging is taxed on each individual finished item?
Does the tax on plastic packaging also apply to the component your packaging contains?
HM Revenue & Customs- Updated 15 August 2023
- When packaging is considered plastic
- Recycled plastics
- Reprocessing plastics
- Packaging subject to tax
- Check whether the item is subject to plastic packaging tax
- Examples of how to check if multi-material packaging components are plastic
- Examples of calculating the recycled content of plastic in plastic packaging components
WHEN PACKAGING IS CONSIDERED TO BE PLASTIC
For the purposes of plastic packaging tax, plastic means a polymeric material to which additives or substances may have been added. Cellulose-based polymers that have not been chemically modified, such as viscose, are not treated as plastics for the purposes of the plastic packaging tax. Other cellulose-based materials that are chemically modified, such as cellulose acetate, are considered plastics. Additives include materials such as calcium or dyes. When assessing the amount of plastic in a packaging component, additives are classified as part of the plastic.
Plastics include polymers that are biodegradable, compostable, oxidegradable. If a plastic packaging item is made of multiple materials, but contains more plastic (including additives that are part of the plastic) than any other substance by weight, it is classified as a plastic packaging item for tax purposes.
Other substances to be considered are: glass, aluminium, steel, other metals, paper and cardboard, wood, any other substances. Records should be kept showing what substances are in plastic packaging. Examples of how to check whether packaging components made of many materials are plastic can be found at the end of this blog.
Components containing adhesive
When considering whether a component contains more plastic by weight and whether it contains glue, it is important to check whether the glue is plastic. If the adhesive does not meet the definition of plastic, it must not be considered as 'any other substance' on the list of 'other substances' when determining whether the component contains more plastic.
RECYCLED PLASTICS
Plastic packaging items containing 30% or more of recycled plastic are not taxable. However, they still count towards the 10-tonne threshold for packaging produced or imported in a 12-month period and records must still be kept. For the purposes of plastic packaging tax, all plastics are assumed to be made from non-recycled (virgin) materials unless there is evidence that recycled materials have been used.
Examples of how to calculate the percentage of recycled plastic in packaging can be found at the end of our blog.
Recycled plastic is derived from plastic waste that has been reprocessed from consumer or consumer plastics using a chemical or mechanical manufacturing process. This allows it to be used for its original purpose or for other purposes. Organic recycling is not included.
Pre-consumer plastics
Pre-consumer plastic is plastic recovered from waste generated during the production process. It is then processed by a reprocessing plant so that it can be used as a raw material. This does not include any material that would normally be reused in the production process to avoid becoming plastic waste, e.g.: reintroducing scrap or milling into the production process after minimal processing. Minimal processing includes shredding and milling.
Post-consumer plastic
Post-consumer plastic is plastic that is generated by the end user of a product when it can no longer be used for its intended purpose.
The end users are:
-households
-commercial facilities
-industrial facilities
-institutional facilities
This includes material returns from the distribution chain.
PLASTICS PROCESSING
The reprocessing of pre-consumer and post-consumer plastic waste can take place at a reprocessing site or at your own facility if you have the facilities. For plastic waste to be classified as recycled, it must be reprocessed so that it can be used as raw material for another plastic packaging component.
Examples of processes involved in the reprocessing of plastic waste can include:
Melting, blending, remelting to obtain pellets, etc. This list is not exhaustive.
EXAMPLE A
Example of using scrap or milled plastics to produce plastic packaging components
Company A produces plastic trays.
Company A collects waste after the production of plastic trays.
Company A minimally recycles the scrap by shredding it and reuses it to produce similar plastic trays.
Scrap metal cannot be treated as a recycled plastic tray component.
EXAMPLE B
Example of reprocessed pre-consumer plastic on site that can be treated as recycled plastic in plastic packaging components.
Company B manufactures plastic trays.
Company B collects waste after the production of plastic trays.
Company B reprocesses the waste on site, shredding it into smaller pieces and melting it down to produce plastic pellets (recyclate).
Company B reuses the recyclate to produce similar plastic trays or other plastic packaging components.
Recyclate can be considered as part of plastic trays or other recycled plastic packaging items.
EXAMPLE C
Example of reprocessed post-consumer plastic that can be treated as recycled plastic in plastic packaging components.
Company C buys recycled post-consumer plastic (recyclate) from a recycling company.
Company C uses recyclate to produce plastic trays.
Recyclate can be regarded as a recycled component of plastic trays.
TAXABLE PACKAGING
Two types of plastic packaging are subject to the tax. These are packaging designed for:
- use in the supply chain
- single use by the consumer
If your packaging consists of several elements, you have to account for plastic packaging tax on each element!
The individual packaging components are usually produced separately before being combined into a packaging unit. Examples include:
-bottles, caps and labels are manufactured separately before being assembled into beverage and liquid packaging
-tacks, boxes and plastic windows are produced separately before being assembled into packaging for certain food products such as cakes and pastries.
Packaging designed to be suitable for use in the supply chain
It is important to check that any plastic packaging element manufactured or imported is subject to plastic packaging tax. A plastic packaging element is a product designed to be suitable for use in the supply chain, from the producer of goods to the user or consumer. It can be used on its own or in combination with other products.
If a packaging element meets the definition, it does not matter whether it is produced or imported for use in the goods supply chain or by the consumer or user. It must fulfil at least one of the following functions: contain goods, protect goods, handle goods, present goods, deliver goods.
Examples of packaging elements include plastics:
- trays used to store and protect food, such as the ready meal tray
- film for protecting goods, e.g. film around raw meat
- containers designed for the handling and delivery of products, for example yoghurt containers.
Find more examples of packaging designed for use in the supply chain.
Packaging intended for single use
For the purposes of the plastic packaging tax, single-use consumer packaging is any single-use product intended for use by the consumer or household user to fulfil one or more of the following functions in relation to goods or waste: storage, protection, handling, presentation, delivery.
These products will be used by the consumer and not in the supply chain.
Examples of disposable consumer packaging include plastic bags, disposable cups, plates and bowls, gift wrapping such as ribbons and adhesive tape.
FIND OUT WHEN PLASTIC PACKAGING IS TAX-FREE!
source: https://www.gov.uk/guidance/check-which-plastic-packaging-is-exempt-from-plastic-packaging-tax
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There are 4 categories of exempt packaging. These are:
- used for direct packaging of licensed human medicines
- durably registered for uses other than packaging
- used as transport packaging for the safe import of many goods into the UK
- used in aircraft, ships and railway freight depots
EXEMPT PACKAGES WHICH COUNT TOWARDS THE 10-TONNE REGISTRATION THRESHOLD
Plastic packaging used for medicinal products for human use and plastic packaging permanently registered for non-packaging use must be included in the calculation of the total weight of packaging produced or imported.
Source:
https://www.gov.uk/guidance/work-out-which-packaging-is-subject-to-plastic-packaging-tax
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