Plastic Packaging Tax: Frequently Asked Questions

Who will it affect?

Plastic Packaging Tax applies to UK manufacturers and importers of plastic packaging. Inevitably, the tax will have significant cost implications for customers and end-users within relevant supply chains.

How much is the charge?

The Plastic Packaging Tax imposes a charge of £210.82 per metric tonne of plastic packaging (imported or manufactured) and is applied when the packaging has undergone its final substantial modification. However, if plastic packaging is exported within a 12-month period, then the liability is cancelled.

What goods will be liable?

Plastic Packaging Tax will be charged on the import and production of finished* plastic packaging that is:

• Predominantly plastic by weight; and
• Does not contain at least 30% recycled plastic.

The packaging element of the goods has been defined as involving one of the following elements for goods at any point in the supply chain:

• Containment
• Protection
• Handling
• Delivery
• Presentation

*A packaging component is ‘finished’ when the component has undergone its last substantial modification; or the last substantial modification prior to the packing/filling process of the packaging.

When is registration required?

A business will need to register if it expects to import or manufacture 10 tonnes or more of qualifying finished plastic packaging in the next 30 days, or imported into the UK or manufactured 10 tonnes or more of finished plastic packaging components in the last 12 months. Registration may still be required even if the packaging used contains over 30% recycled plastic or if the liability is expected to be nil.

Significantly, groups can elect to appoint a representative member to register and pay the tax charge for an entire group.

A business will be required to keep accounts and records and once registered it will use the information to support the quarterly PPT returns it will be required to complete and submit.

What are the exemptions and exclusions?

The following are exempt from Plastic Packaging Tax:

• Plastic packaging used for the immediate packaging of licensed human medicine.
• Plastic packaging permanently recorded as set aside for non-packaging use.
• Plastic packaging used as transport packaging to import multiple goods safely into the UK.
• Plastic packaging used in aircraft, ship and rail goods stores.

Packaging for ‘licensed human medicine’ and  ‘permanently recorded as set aside for non-packaging use’ must be included when working out the total weight of packaging manufactured or imported.

There are certain packaging products that are excluded from the Plastic Packaging Tax. These products should not be taken into account when working out the total weight of packaging imported or manufactured.  The three types of products to be excluded are:

• Packaging designed to be used for long-term storage of goods
• Packaging designed as an integral part of the product
• Packaging that is designed for displaying products and will be re-used in this way

How we can help

We can provide the advice you need, to guide you through all the considerations to bear in mind when trying to establish whether Plastic Packaging Tax applies to your business. For instance:

• Support: We can support to understand the new tax and how it impacts your business.
• Advice: We can provide advice on whether the plastic packaging products that your business imports or manufactures fall within the scope of the tax
• Registration: We can confirm whether plastic packaging tax registration is required
• Compliance: We can also advise on the necessary steps you must take to comply with the tax, for example, what data is needed for compliance and when and how the quarterly returns should be completed and submitted.

Get in touch

If you have any queries on Plastic Packaging Tax, feel free to get in touch with your usual Indirect Tax team contact, or via the button below:

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