What does the plastics packaging tax mean for food businesses?
In April 2022, the UK Government brought in the Plastics Packaging Tax, where the importer or manufacturer of plastic packaging pays £200 tax per tonne on plastic packaging produced in, or imported into the UK, that does not contain at least 30% recycled plastic. In 2024, the scheme continues to be implemented, although the cost per tonne has increased in line with inflation to £217.85 per tonne.
What are the benefits of the plastics packaging tax?
The UK plastics packaging tax is designed to incentivise businesses to use a greater proportion of recycled materials in the production of plastic packaging, making the products more environmentally friendly. The plastics packaging tax helps to drive less plastic going to landfill or incineration by recycling plastics instead. The recycled material can then be used to produce new plastic packaging products, such as Aegg’s rPET food pots.
What are the downsides of the plastics packaging tax?
Currently, the UK kerbside collection infrastructure is inconsistent, making it confusing for residents, which has a negative effect on recycling rates, and in turn the supply of recycled materials. The Government announced that consistent local authority recycling collections will come in only after the implementation of extended producer responsibility (EPR) for packaging, which has been pushed back to October 2025.
Why does your organisation need to know about the Plastics Packaging Tax?
If your organisation is not an importer or manufacturer of plastic packaging, you will not be directly liable for the plastics packaging tax (unless you significantly modify the packaging), as some of these costs will already have been built into the product you are buying from your supplier (such as Aegg Creative Packaging). However, it is useful to know about the tax, helping you make informed decisions about your packaging and adapting to the rate changes to manage costs.
How can you mitigate Plastics Packaging Tax-associated costs for food packaging?
There are several options available to you.
The obvious choice is to switch to packaging made up of at least 30% recycled materials, where no plastics packaging tax is applied. For example, our Heritage pots and Tulip pots are both available in rPET, which includes 30% recycled material, making the pots PPT-exempt.
rPET can handle temperatures up to 55C and down to -20C, so the pots can be used for ambient, chiller and even frozen foods. Food-grade rPP is also a material containing recycled PP, although it is not widely available and carries a higher premium, making it more costly to produce.
Another option is to consider other alternative materials, such as glass packaging, which is infinitely recyclable. Aegg supplies both plastic and glass food/ drink packaging, so we can advise you on the best type of packaging to meet your requirements and budget.
In the photo: Aegg's Gediz spirit bottle
Thirdly, you could change to a lighter weight product with a reduced overall amount and weight of the packaging. For example, to mitigate against the higher rPP costs and lower available supply, we have developed PP packaging that takes up to 30% of the weight out of some of our PP pots, including our tumbler. This reduces both the cost and tax liability of the packaging without compromising the functionality.
In the photo: Aegg Tumbler
If you found this article useful, you may also like to view these ones:
Aegg’s Plastics Packaging Tax interview with BPF (British Plastics Federation) Plastic & Flexible Packaging Group Director for his views on the Plastics Packaging Tax.
Aegg’s thoughts on the rigid plastics market
Aegg’s thoughts on 2024 trends for the Food and Packaging Industry
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