Plastic Free month - Do you know about the plastic tax?

claireslk
Jul 7
3 min read

Plastic Packaging Tax: What It Means and Why It Matters

In the UK's growing commitment to environmental sustainability, one important policy stands out: the Plastic Packaging Tax (PPT). Since its introduction, this tax has reshaped how businesses approach packaging, recycling, and product design. But what exactly is the Plastic Packaging Tax, and how does it affect businesses and consumers in 2025?

What Is the UK Plastic Packaging Tax?

The Plastic Packaging Tax (PPT) is a UK government levy applied to plastic packaging that does not contain at least 30% recycled plastic content. It was introduced on 1 April 2022 and is administered by HM Revenue & Customs (HMRC).

As of 1 April 2025, the tax is charged at a rate of £223.69 per metric tonne of plastic packaging that falls below the 30% recycled threshold.

Why Was the Tax Introduced?

The goal of the Plastic Packaging Tax is to:

Reduce the use of virgin (new) plastic.
Encourage manufacturers to use more recycled content.
Decrease the environmental impact of plastic packaging.
Promote the development of the UK circular economy.

With plastic pollution remaining one of the most pressing environmental issues globally, the tax helps drive real change in packaging practices across industries.

Who Is Affected by the Tax?

The tax applies to businesses that manufacture or import plastic packaging into the UK. More specifically:

You must register for PPT expect to import into the UK or manufacture in the UK 10 tonnes or more of finished plastic packaging components in the next 30 days; OR
Have imported into the UK or manufactured in the UK 10 tonnes or more of finished plastic packaging components in the last 12 months
It applies to plastic packaging used for products, whether the packaging is filled or unfilled.
Both UK-based manufacturers and international importers are subject to the tax.

Businesses are required to file quarterly returns to HMRC and maintain records detailing the recycled content in their packaging.

What Types of Packaging Are Exempt?

Not all plastic packaging is taxable. The following are exempt:

Packaging with 30% or more recycled plastic.
Medical packaging, such as for prescription medicines.
Transit packaging used to import goods into the UK.
Packaging that is not predominantly plastic by weight.
Certain exports, if moved outside the UK within 12 months.

What Are the Implications?

For Businesses:

Increased costs if packaging doesn’t meet recycled content thresholds.
Need for auditing, reporting, and supply chain transparency.
Opportunity to redesign packaging and collaborate with sustainable suppliers.

For Consumers:

Some businesses may pass on costs, leading to minor price increases.
Increased awareness of eco-friendly and sustainable product choices.

For the Environment:

Reduced demand for virgin plastic.
Stronger market for recycled plastics.
Support for innovation in sustainable materials.

How Can Businesses Stay Compliant?

Evaluate packaging materials: Understand the composition and recycled content.
Register with HMRC: If you meet the 10-tonne threshold.
Keep accurate records: Document recycled content, packaging usage, and exemptions.
Redesign responsibly: Look for ways to reduce plastic use and switch to recycled or alternative materials.
File PPT returns quarterly: Ensure timely compliance to avoid penalties.

Final Thoughts

The UK Plastic Packaging Tax is more than just a regulatory obligation it’s a catalyst for sustainable innovation. As environmental concerns continue to rise and regulatory pressure increases, businesses that act now to adopt greener practices will not only reduce their tax burden but also future-proof their brands.

Whether you're a manufacturer, importer, or retailer, now is the time to evaluate your packaging strategy and embrace the shift toward a more circular, responsible future.