Plastic Packaging Tax to impact food manufacturers

25 February, 2022

The forthcoming UK Plastic Packaging Tax (PPT) due to be introduced on 1 April 2022 is one of a number of tax changes that could have significant financial impact on food manufacturers in the coming months.

The tax will see plastic packaging manufactured or imported into the UK containing more plastic by weight than any other single material charged a tax of £200 per tonne from 1 April 2022. Packaging containing less than 30% recycled plastic is exempt.

Plastic packaging is used in a wide variety of sectors so PPT will have a broad impact. Examples of businesses likely to be affected include:

  • Retailers - importing products such as bin liners, sandwich bags, water/fizzy drinks bottles, and carrier bags
  • Manufacturers – manufacturing or importing plastic components
  • Publishers – importing plastic used for laminating books or applying plastic sleeves to magazines
  • Transport providers - importing plastic for transporting goods such as bubble/pallet wrap
  • Fresh food producers - importing plastic packaging to seal their products.

Registration for PPT is mandatory for any organisation that manufactures or imports more than 10 tonnes of plastic packaging, regardless of the amount of recycled plastic they contain. Even if PPT is not ultimately due, all organisations importing, or manufacturing plastic packaging must comply with the record keeping requirements.

This process will create an administrative burden on all businesses having to register for the tax, provide declarations within customer invoices and maintain all records in case of HMRC investigations.

Alongside the increase in corporation tax and employers’ National Insurance contributions, the plastic packaging tax represents another additional cost for businesses falling above HMRC’s threshold.

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