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European Union to Introduce Plastic Tax

A plastic tax introduced by the European Union will levy a 800 euro per tonne fee on non-recyclable plastic waste.

From January 2021 the European Union will introduce an €800 per tonne levy on non-recyclable plastic waste. The introduction of a levy upon plastic waste will go in some way to negate the cost of the €750 billion coronavirus recovery fund agreement.

Proceeds from this tax will go directly to the European Union, rather than the governments who collect them. The tax has been presented by the European Commission as “contribution to the EU budget designed to incentivise member states to increase recycling from plastic waste”.

Concerns have been raised by European Plastics Converters association over the lack of clarity as to how this tax will be implemented into countries with vastly differing waste management systems and that the proceeds from the tax raised are not earmarked for further investment into the waste and recycling industry.  

EU leaders have not yet reached an agreement on the 2021-2027 budget, meaning the details are subject to change and details have yet to be clarified for member states. Market participants main concern lies around the data available and who will have the burden of reporting this information.  

UK plastic tax

This tax differs from the minimum content regulation proposed by the UK, coming into effect in April 2022, as producers will be charged per gram of unrecyclable plastic used in member states in the EU.

The current impact upon the UK of the EU plastic tax is currently unclear as the UK has left the EU but has yet to agree a deal.  

After the end of the transition period, at the start of 2021, the Great Repeal Bill will enable already existing EU laws to be transposed into UK law. However, some trading laws are still being negotiated and there is yet to be clarity on how this tax could impact UK producers. 

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