From April 2022, the UK government are introducing the Plastic Packaging Tax (PPT). The tax will affect many of us, as it will affect plastic manufacturers, anyone involved in supply chains, as well as consumers and sellers. The hope is that the tax will encourage the use of more recycled plastic in packaging. Assuming you are a business owner or fit one of the aforementioned categories, this article will give you all the information you need to prepare for the introduction of the Plastic Packaging Tax.

What Is The Plastic Packaging Tax?

The tax will apply to all plastic packaging in the UK that has either been manufactured or imported to Britain that does not contain at least 30% recycled plastic. If you are unsure as to what is classed as ‘plastic packaging’, this is any packing that is made up predominantly of plastic (by weight). Packaging imported to the UK will be liable for the tax, regardless of whether it is being used to transport products or not.

As stated in the introduction, this will apply to many different people. However, due to the disproportionate amount of administrative burden that will be inflicted, there will be exemptions for manufacturers and importers of less than 10 tonnes of plastic packaging each year. You can find the full legislative draft on the GOV website.

What Impact Will PPT Have?

Socially, it is hoped that the tax will encourage businesses to use more recycled plastic and will thus make many industries better for the environment. If the tax is successful, it is hoped that businesses will use less plastic packages and that consumers will choose products that use less plastic packaging (as it is assumed that products that use plastic packaging will be more expensive). This being said, the government is hoping that not too much of a burden is placed on consumers, since packaging is usually only responsible for a fraction of the overall price of a product.

It is expected, though, that the tax will affect around 20,000 manufacturers and importers. As well as one-off costs associated with familiarization of the new rules, businesses will also face the costs of filing and amending their VAT returns. There may also be costs associated with amending supply chains.

How To Register For PPT

A point of interest for businesses is that they will have to register for PPT if they handle plastic packaging, regardless of whether they meet the 30% recycled content threshold. This obviously means that businesses must be aware of their compliance obligations, and must prepare their business, way in advance of April 2022.

If your business would be liable, you will have to register in April 2022. In order to register, you will need to provide a lot of information, including your business type and address, and an estimate of how much plastic packaging you will be likely to use. Once registered, you will be issued a reference number and information that you receive from HMRC.

We Are Here To Help

Should you require any assistance with the Plastic Packaging Tax, don’t forget that our long history of working with ecommerce sellers, especially those who use Amazon and eBay, means we offer expert advice when it comes to your processes.

Please do not hesitate to send us an e-mail at enquiries@jpaccountant.com or contact us through social media to receive a quote today for our support with all your tax needs or logistic support. In addition to our logistic and ecommerce services, we would be more than happy to help you register for UK & EU VAT and file your UK & EU VAT returns, and help you comply with VAT in case your account faces any issues.