Plastic Packaging Tax – Chemically recycled content

Since its introduction on 1 April 2022, legislation states plastic packaging tax (PPT) is not payable on packaging with more than 30% of recycled material. This tax hopes to encourage the use of recycled plastic within supply chains.

Although chemically and mechanically recycled material contribute to the 30%, businesses found it difficult to evidence the amount of recycled content within chemically adjusted plastic.

The conclusion of a government consultation has been published, allowing businesses to use a ‘mass balance approach (MBA)’ and certification schemes to track recycled plastic through the plastics value chain.

This welcome response will allow business to bring this material within its calculations and should the packaging breach the 30% threshold, PPT will not be payable. 

The government response also confirmed that as part of the MBA, pre-consumer waste will no longer be classified as recycled plastic. This confirmation closes the ‘loophole’ which allowed some business to inflate the recycled content of plastic packaging and above the 30% threshold.

The final response confirmed the exemption for the immediate packaging of licensed human medicines will remain in place for the foreseeable future.