What the new Plastic Packaging Tax Means for Businesses

On 1 April, the ‘Plastic Packaging Tax’ came into effect, which is likely to affect many businesses, big and small, who are sure to feel the pain of reporting the amount of plastic they use in their packaging, as well as the increase in the cost of their packaging. 

What is the tax?

Manufacturers or importers of ten or more tonnes of plastic will be charged £200 per tonne of finished plastic packaging components that contain less than 30% recycled plastic. 

The law marks a new phase of accountability as it is effectively an environmental tax designed to provide a financial incentive for businesses to use more recycled plastic or reduce plastic usage altogether. This is in the hopes of diverting excess waste from landfill or incineration, and instead encouraging businesses to reduce, reuse and recycle. 

Photo by Nick Fewings on Unsplash

What does the introduction of the tax mean for businesses?

Whilst the plastic tax is a great environmental win, it is set to cause serious supply chain issues in the short term, as well as inevitable cost implications for consumers. 

This is due to it creating a crunch time for businesses to make critical changes en masse, driving prices up. This includes devising innovative plastic alternatives, ways to reduce plastic and packaging altogether, or utilising recycled plastic instead of virgin plastic material. Whilst the shift to using more recyclable plastic materials is a move in the right direction for all future-fit businesses, there are a host of downstream considerations too! 

What should businesses be doing?

The first port of call is to work out if your business is liable to pay the tax (i.e. whether you are over the 10-tonne per year threshold.) If you are simply a consumer of plastic products then the most likely way you will be affected is to see a slight increase in the cost of your plastic products. 

If you produce plastic packaging or meaningfully alter your plastic packaging in any way, you will likely be required to register for the tax and to accurately account for all of your tax usage. It is important to review the government’s guidance on the tax to determine your responsibility. 

Either way, it is important that businesses keep records of the materials they use in their packaging (and whether it is exported!), as this may help you lower your tax liability, and save a bit on packaging. There is a handy guide on the UK government site which gives actionable tips and strategies to ensure your record keeping is covered. 

Once you have established your responsibility in terms of the new tax law, we suggest having conversations with your suppliers as well as your packaging and labelling teams to brainstorm ways in which to reduce plastic packaging, and increase the use of more sustainable options. 

The PeterLynn team are always happy to make recommendations if this is something you are struggling with. 


PeterLynn is an expert manufacturer of printed and plain labels serving over 1,200 customers. Since 1985 PeterLynn has fostered long term customer relationships through our hands-on approach to managing your label projects and needs.

01536 400344


Plastic Packaging Tax (Gov.uk) 

Packaging costs rise in wake of plastics tax (Food Manufacture) 

Could the Plastic Packaging Tax Unwrap in Innovation (Packaging Gateway)  

Food and Drink Businesses need to get ready for the new plastic packaging tax (Scotsman) 

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