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Plastics recycled content tax gets the thumbs-up

By 31/10/2018News

Chancellor Philip Hammond’s star Budget environmental measure of a tax on plastic packaging, which uses less than 30% recycled content, has generally been welcomed by the recycling sector, with responses ranging from ‘game-changer’ to ‘caution’.

Marcus Gover, chief executive of the WRAP charity which is part-funded by Defra, described the Treasury approach as “radical” with the potential to be a “game-changer”.

Jacob Hayler

Jacob Hayler of the ESA welcomed the stimulating of demand for recycled material

And, Mr Gover indicated that he expects the forthcoming Resources and Waste Strategy to be closely aligned with the fiscal measures proposed by the Chancellor.

The plastics 30% tax, which is likely to come into force in 2022, was backed by the UK’s waste sector with its trade body, the Environmental Services Association (ESA) welcoming the measure and pointing that it prefers the tax as a driver to recycling rather than penalties such as an incineration tax.

ESA executive director, Jake Hayler, said: “Without stimulating the demand for recycled material, higher recycling rates will be unachievable. We are pleased that the Treasury has recognised that this is the most effective way to ensure the right incentives are in place for recycling.”

The view from the Resource Association was measured, with chief executive Ray Georgeson remarking that “a  30% recycled content threshold is a welcome opening proposal which has the effect of being a virgin plastics tax if implemented correctly… but not necessarily appropriate for other materials.”

“Action across the supply chain is needed to address issues of poor quality recyclate”

Ray Georgeson
Resource Association

And, Mr Georgeson reasoned that creating demand for recycled material is not just about the fiscal incentive; “Action across the supply chain is needed to address issues of poor quality recyclate from many collection and sorting programmes”.


Simon Ellin, chief executive of the Recycling Association said “We’re happy with the introduction of a tax that requires manufacturers to incorporate 30% recycled content into new plastic packaging.” And, Mr Ellin also called for the tax to be “earmarked to boost recycling used to bring uniformity into local authority collections, making it easier for everyone to achieve better results”.

The plastics sector highlighted the need to ensure there were suppliers available of recycled material to meet the demand likely from the plastics 30% tax. Philip Law, director general of the British Plastics Federation, emphasised that his members share the “government’s ambition to leave the environment in a better state for future generations … and we are ready to help them get it right in a conversation that needs to involve manufacturers, retailers, recyclers and the wider public.”

Mr Law added: “We urge caution when it comes to demanding a particular level of recycled content in packaging products, as we must ensure the UK has the recycling infrastructure to meet demand. It is important that revenue raised by the new tax is invested in developing the UK’s recycling infrastructure to help the UK to remain competitive and meet the growing demand for recycled content.”

Gudrun Cartwright of Business in the Community said the tax should be ringfenced

The British Retail Consortium also mirrored the call for development of recycling, saying that: “Retailers recognise how important it is to their customers to tackle plastic pollution, removing it where possible and ensuring all packaging is recyclable. For this tax to make the difference that everyone wants to see, it is essential that the revenue raised is put back into recycling innovation rather than being locked away by the Treasury.”

Market failure

Concerns that the Treasury might keep the tax were also of concern to Business in the Community. Gudrun Cartwright, environment director at BitC said: “Ensuring that any new tax on plastic is ringfenced to enable innovation for long-lasting solutions that position the UK as world leaders in tackling shared challenges such as these will be essential.”

The tax could help with market failures, said the Chartered Institution of Wastes Management (CIWM).

“CIWM, alongside many other organisations across the sector, has repeatedly pressed for measures to stimulate secondary material markets, particularly to support and increase plastics recycling, where there is a degree of market failure. The new tax proposal is, therefore, welcome and we look forward to engaging fully with the consultation,” said Pat Jennings, the Institution’s head of policy.

Waste industry views

Waste management companies also responded to the Budget measures relating to the Environment.

Jeff Rhodes, head of environment and external affairs at Biffa, voiced concern that the 30% plastics tax did not go far enough. He said: “While a new tax on plastic packaging containing less than 30 per cent recyclable plastic is welcome, the Chancellor refused at this stage to go so far as introducing a tax on single-use plastics. Although this is a tactic which may lead to some improvement in recycling rates, the conditions placed on this tax mean it simply does not address the larger issues at hand currently prohibiting critical progress.”

Industry heads

(clockwise from top left): Jeff Rhodes, Biffa; Paul Taylor, FCC Environment; Richard Kirkman, Veolia; and David Palmer-Jones, Suez UK

Mr Rhodes continued: “Taxes can be an effective tactic as seen previously with the plastic bag levy, but we need to go back to the source. Waste producers must bear greater financial responsibility for the design, collection and treatment of plastic products, rather than passing costs and problems along the supply chain.”

Paul Taylor, FCC Environment chief executive, was of the view that the tax is a step in the right direction but stressed the need for infrastructure to be in place including support for energy from waste.

Mr Taylor commented: “The UK’s ever growing capacity gap requires immediate attention – and we do not currently have in place proven technologies that will be able to process our excess waste. In our view, the government must therefore support the construction of energy from waste facilities here in the UK, a cost-effective technology which will mean less waste ends up in landfill, as well as encouraging waste prevention via ‘reuse’ schemes.”

The 30% plastics tax was also supported by David Palmer-Jones, chief executive of SUEZ recycling and recovery UK. He felt that Mr Hammond had signalled a “much-needed change to the way we produce and consume plastics and packaging,” and welcomed the consultation on the tax.

Mr Palmer-Jones continued: “It is right that, as a society, we tackle the scourge of single-use items by taxing a throw-away culture and rewarding a re-use and recycle economy. The announcement from the Treasury sends a clear message that the government is serious about delivering a circular economy for Britain. We are pleased to see that the Chancellor is not taking a piecemeal, straw-by-straw approach, but will consult on a more holistic tax, which seeks to drive a circular economy in recycled materials.”


For Veolia UK & Ireland, chief technology and innovation officer, Richard Kirkman, said that the tax has the potential to “ensure recycled content becomes the currency of production”.

He noted: “Industry, government and consumers have mobilised this year to tackle the plastic challenge and Veolia’s intention is clear – by opening two domestic recycling facilities in the last 12 months and committing to invest £1 billion in infrastructure in the next five years we are backing UK recycling.

“To make the UK a waste-to-resources heavyweight we must also remove confusion for consumers and encourage investment in domestic infrastructure to secure a circular approach for the next generation.”

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Source: Plastic