What is the new Plastic Packaging Tax? Here’s what it means for the vaping industry

Climate change is the phrase on everyone’s lips, and the pressure on world leaders to tackle it is ever-increasing. In the 2021 budget, the UK Government set out plans to introduce a new Plastic Packaging Tax, which comes into force in April 2022. 

The new tax will impact businesses across a huge range of industries, including e-liquid manufacturers. So, who will be affected and how much will you have to pay? Here’s everything you need to know about the new Plastic Packaging Tax. 

What is the new Plastic Packaging Tax?

The tax aims to increase the use of recycled plastic packaging and decrease the UK’s plastic production and waste. It’s hoped that the tax will encourage both the production and use of recycled plastic across a wide range of industries, by incentivising businesses to make greener choices. 

The new Plastic Packaging Tax will come into effect from the 1st April 2022, so it’s really important that you start to prepare ASAP. The tax does not apply to any packaging that is made up of more than 30% recycled content, or any packaging that is not predominantly plastic by weight. The rate of the tax will be £200 per metric tonne of plastic packaging that contains less than 30% recycled plastic. 

Who will be impacted by the Plastic Packaging Tax?

It’s predicted that around 20,000 producers and importers will be affected by the new tax across a wide range of industries, including retail, construction and manufacturing. It affects any packaging that is produced in or imported into the UK, including anything that is prefilled with products, such as food and drink. 

However, if you import less than 10 tonnes of plastic packaging in 12 months, then you will be exempt. This has been included to prevent small businesses from being disproportionately affected and to ensure it targets those who create the most plastic waste. 

Who will need to keep records?

If your business imports or manufactures plastic packaging, then you will need to keep records of this, even if it’s less than 10 tonnes per year. It’s expected that the requirements for record keeping will be reduced if you’re exempt, but the full details of how this will work aren’t expected until nearer the time. It’s also likely that you will need to keep records and  register for the tax even if all the packaging you manufacture or import contains more than 30% recycled plastic, to prove that you are exempt. 

If you are a business that needs to register, you will need to pay Plastic Packaging Tax on any packaging that contains less than 30% recycled plastic. For example, if you manufacture 10 tonnes of plastic packaging, and 1 tonne contains less than 30% recycled plastic, you will need to pay £200.

For more information on registration and record keeping, take a look at the government guidance.

What does this mean for the vaping industry?

Almost all e-liquid manufacturers across the UK will be impacted by the new Plastic Packaging Tax. E-liquid is sold in plastic bottles, and due to the nature of vape juice and how recycled bottles are made, we feel it’s safer to stick with PET 1 packaging. 

PET 1 bottles are fully recyclable, and whilst it will now cost an extra £200 per tonne to import them, it’s important to put customer safety first. It may be that this tax encourages plastic manufacturers to create solutions in the near future that are safe for e-liquid storage, but for now it’s going to be very difficult for the vaping industry to avoid the additional cost. 

According to the Government, the increased cost to manufacturers isn’t likely to be passed onto the customer, as packaging makes up a small proportion of the product price. However, this will vary from business to business and it depends on how much it will impact their production costs. Full details of the new tax are set to be published soon, but you can start getting your business ready now by checking the Government website.

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