Italian plastic tax likely to be shelved as government opposed: sources

Italy's plastic tax legislation is likely to be shelved and probably won't be implemented next year, according to industry sources.

Italy had originally proposed plastic tax legislation in 2020, with the aim of implementing it at the beginning of this year, but that has now been put back to 2024. However, at least two recyclers said that they believed the tax was unlikely to be implemented at least in the near term.

"The government [that assumed office] at the moment is opposing the tax," an Italian recycler said.

"When you start taxing plastics, you start moving away from plastic to other materials that are not as sustainable, " an Italian recycler said. "The final result is that the ecological impact has worsened."

Plastic packaging is regarded as carrying a lower carbon footprint than paper packaging. For example, paper packaging would need to be several times heavier than plastic packaging for grocery bag application.

Moreover, one of the government's targets is to minimize any taxes on consumer goods, a source said.

Another source who was more amenable to such a tax said it would eventually be implemented even though the market was not generally in favor of it yet.

Market participants also said such a tax had had minimal in Spain and the UK, and that the current price disparity between virgin and recycled material was driving consumers to use virgin material, despite the tax. "Look at Spain; you see that the consequences don't change the scenario," a recycler said.

"I think for the tax to make any significant difference it must be Eur0.85/kg, " a trader said. At present, the tax is stipulated as Eur0.45/ kg for non-recycled plastic.

Platts, part of S&P Global Commodity Insights, assessed NWE R-PET Food-Grade Pellets at a Eur805/mt premium over Virgin PET FD NWE spot material on March 29.

Platts assessed recycled high-density polyethylene natural pellets at Eur1,910/mt FD Northwest Europe March 29. The virgin HDPE blowmolding grade was assessed at Eur1,300/mt FD NWE on the same day. The recycled grade is Eur610/mt more expensive than the virgin grade.