Newly into effect on the 1st of this month (April 2022) is the UK Plastic Packaging Tax.
Companies either manufacturing or importing over 10 tonnes of plastic for packaging, will need to register for the tax. And if they don’t incorporate at least 30% recycled plastic in their packaging they will be liable to pay £200/ tonne.
The UK, along with Italy and Spain is one of the most recent large economies to bring in this kind of taxation.
What are the implications of this on UK FMCG companies?
Since registration for the tax is required for companies using 10 tonnes of plastic or more per year, all but the very smallest of companies will be directly affected. Companies will be expected to set up systems for suitable data collection to manage their compliance with the tax.
Once this is in place, the focus for companies will shift to how to operate effectively given the significant new constraints that the tax introduces.
With the new tax in place, companies must source good quality recycled plastic in large quantities in order to use more than 30% recycled plastic in their product packaging. That’s not easy.
And even if that is achieved, maintaining quality consistency on par with virgin plastic will be a further challenge.
How can Packaging for the Future help?
By reducing plastic requirements, the reduced reliance on the material increases business resilience; at the same time reducing costs.
If you currently manufacture a package, say, a bottle using 100 grams of plastic, but you could reduce each bottle’s use of plastic to 50 grams of plastic, that means 50% less recycled plastic sourcing challenges; or 50% less plastic packaging tax.
Either way, that's a win.
Using our zero based cost optimisation modelling we have saved the very largest FMCG companies millions of pounds in reduction of the use of plastic in their packaging, cost savings that will be even further increased under this new change to the economy.
Be in touch to see exactly how we can help you.
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