Autumn Statement: Plastic Packaging Tax increase a ‘double-whammy disappointment’
The Government’s announced increase to the packaging levy in line with inflation has been criticised for not going far enough in disincentivising the use of raw materials.
The tax increase, announced within the Government’s Autumn Statement, will see the Plastic Packaging Tax (PPT) increase to £217.85 per tonne from 1 April 2024 – a figure £17 higher than when the tax was introduced.
To ensure the continued effectiveness of the PPT in incentivising the use of recycled plastic in packaging, the Government has committed to publishing an evaluation plan by the end of the year and to gather further evidence to inform the future position of the rate and recycled plastic content threshold.
The UK Government also announced within the Autumn Statement that it is launching a £78 million pilot fund to ”alleviate the cost of landfill tax where it is acting as a barrier to the remediation and redevelopment of contaminated land.”
Reaction to Plastic Packaging Tax increase
Responding to the announcement, Executive Director of the ESA, Jacob Hayler, said: “As a result of low virgin polymer prices and the wider macroeconomic outlook, the plastics recycling sector is seeing weak demand for recycled material despite governmental ambitions and consumer appetites encouraging greater use of recycled plastic.
“In a double-whammy disappointment for the sector, adding to last week’s announcement that packaging recycling targets (61 per cent for plastic) will remain unchanged in 2024, yesterday’s Autumn Statement missed an opportunity to rectify this situation by escalating the plastic packaging tax rate, instead opting only to raise it in line with CPI from April 2024 to £217.85 per tonne.
“Government’s ambition to achieve a 65 per cent municipal recycling rate by 2035, and the inclusion of Energy-from-Waste within the Emissions Trading Scheme from 2028, will increase the supply of recycled plastic into the market and this must be met with corresponding demand-side measures. The current and future context shows that a strong plastics tax escalator, up to £500 per tonne and a minimum recycled content threshold of 50 per cent, is essential.
“We do, however, welcome the news of an evaluation plan, which will present an opportunity to adapt the plastic packaging tax to reflect market conditions and support further investment in plastics recycling."
Plastic Packaging Tax ‘woefully inadequate’
Sian Sutherland, Co-Founder of A Plastic Planet and PlasticFree said: “The ‘Green Industries Growth Accelerator’ has been unveiled, but the £960m in funding excludes plastic replacement technologies. And the woefully inadequate plastic packaging tax is to rise only by inflation. Yet again big oil’s plan B, plastic, is being shielded by Prime Minister Sunak’s government.
“Britons are being forced to deal with the grim inflationary consequences of this Government’s love affair with big oil.
“We could be a global leader in the export of renewables. Instead, this government approves new oil fields and are slaves to eye-wateringly expensive fossil fuel imports. We could be eradicating toxic single-use plastics from our nation and yet the Government shies away from action.
“Around the world governments are using judicious regulation and spending to stimulate the economy and fend off stagflation. But Britain has become a laughing stock on environmental issues while our competitors power ahead.”