Date: 14/06/2021 | Environmental, Regulatory Law
Who will the tax affect?
UK producers of plastic packaging and importers of plastic packaging will be affected directly, as they are liable for paying the tax. However, the cost is likely to be passed on to business customers of producers and importers of plastic packaging and consumers who buy goods in plastic packaging in the UK.
Businesses producing or importing plastic packaging which does not contain at least 30% recycled plastic and businesses or consumers purchasing such goods will soon find their profit margins squeezed.
Key features of the plastic tax:
Any attempt to increase recycling rates and divert waste from landfill and incineration are to be welcomed and should significantly benefit Scotland’s environment. However, this new tax poses some major challenges for businesses at a time when many will be just getting back on their feet following the upheaval resulting from Covid-19 and Brexit.
With just under a year to go before its roll-out, a major concern is whether the UK will have the requisite infrastructure in place for collection and recycling of the plastic material required so that there is sufficiency of supply for businesses who wish to use it and avoid the tax. The government’s position appears to be that availability of suitable material will follow the introduction of the tax, but timing is critical. Regulatory constraints which apply to what recycled material can be used for, for example in food packaging, also create some difficulty.
It is important that the plastic packaging tax does not simply become an unavoidable additional cost to already struggling businesses due to their inability to source the required recycled material.
At Davidson Chalmers Stewart we assist organisations in understanding what their responsibilities are, and will be, and help them to plan for the changes which need to be made to ensure business continuity. If any of these issues resonate with you or you would like to understand more about the potential impact on your business, please contact Chala McKenna at Chala.Mckenna@dcslegal.com for more information or advice.
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