Proposed Plastic Packaging Tax to Begin in 2022
A plastic packaging tax will be introduced from April 2022. It is thought the tax will provide a clear economic incentive for businesses to use recycled material in the production of plastic packaging. This will increase the demand for such material which will in turn lead to an increase in recycling operations and collection of plastic waste to meet this demand. It is hoped the result will be a reduction in plastic waste at landfill or incineration sites.
Who is likely to be affected?
UK producers of plastic packaging, importers of plastic packaging, business customers of producers and importers of plastic packaging, and consumers who buy goods in plastic packaging in the UK. There will be an exemption for producers and importers of small amounts of plastic packaging to avoid excessive administrative burdens in comparison to the tax liability.
What plastic does the tax apply to?
This is a new tax that applies to plastic packaging produced in, or imported into the UK that does not contain at least 30% recycled plastic. It will not apply to any plastic packaging which contains at least 30% recycled plastic, or any packaging which is not predominantly plastic by weight. Imported plastic packaging will be liable to the tax, whether the packaging is unfilled or filled.
Draft Legislation
The government intends to publish draft legislation for consultation which will set out the key features of the tax, such as:
- the £200 per tonne tax rate for packaging with less than 30% recycled plastic
- the scope of the tax by definition of the type of taxable product and recycled content
- the exemption for producers and importers of small quantities of plastic packaging
- who will be liable to pay the tax and need to register with HM Revenue & Customs (HMRC)
- how the tax will be collected, recovered and enforced
Impact on business
The tax is expected to impact an estimated 20,000 producers and importers of plastic packaging. One-off costs include familiarisation with the new rules, training for staff, registration with HMRC, and developing the required reporting framework to complete tax returns. On-going costs could include completing, filing and paying tax returns, keeping appropriate records (including those required to claim the export credit), and amending returns. To support businesses HMRC will develop clear guidance and other tools to help businesses understand and meet their obligations.
It is expected that the impact on businesses will be significant and the overall impact will depend on the design of the tax. The government will be holding a consultation on the design and implementation of the tax, including on guidance and tools that can help businesses meet their obligations.
It is expected that the impact on businesses will be significant and the overall impact will depend on the design of the tax. The government will be holding a consultation on the design and implementation of the tax, including on guidance and tools that can help businesses meet their obligations.
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This is an alternative to our standard retainer system and offers clients an opportunity to obtain advice where the cost is pre-determined for the whole year. This arrangement would suit clients who may from time to time need to seek legal advice but may hold off preferring a ‘wait and see’ approach.
In our experience, early intervention can reduce the risk of the situation escalating as we can give advice and guidance that nips regulatory issues in the bud before they develop into something far worse. We also strongly recommend our clients consider taking out legal expenses insurance to cover investigations and prosecutions brought by regulators.
DyneProtect© has teamed up with Butcher & Barlow solicitors to provide DyneProtect© clients access to a specialist team of corporate and commercial lawyers for up to 1 hours’ worth of free telephone advice/legal consultation.
Butcher & Barlow have a dedicated commercial and agricultural hub on Gadbrook Park in Northwich which provides advice and assistance to a host of business clients in specialist areas such as Corporate and Commercial Law, Commercial Property, Private Client and Agriculture.
If you have a corporate or commercial issue which Dyne Solicitors is unable to handle, then Butcher & Barlow’s Commercial team will certainly be able to step in and assist.
DyneProtect© has also negotiated price reductions on OLAT / Driver CPC courses run by training providers KP Legal Limited who are offering discounts to DyneProtect© clients on Operator Licensing Awareness / Compliance training (-20%) and Periodic Driver CPC training (-10%).
