In April 2022, the UK introduced a tax on plastic packaging. The tax, introduced to help reduce plastic waste pollution, is the first of its kind globally to cover all types of plastic packaging. Under the new rules, any packaging that is predominantly plastic by weight made in or imported into the UK for final sale to the consumer will have to include 30% recycled plastic as a minimum. If the recycled content falls short of this inclusion rate, a £200/mt tax on the total weight of the package will be due.
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The introduction of this tax has and will continue to have wide ramifications not just for UK producers and buyers of products packaged in plastic, but for many European and global market participants who export material to the UK. There will, of course, be cost implications as a result of this new legislation, even for those companies who do include 30% recycled content in their packaging. Key recycled polymers – such as recycled polyethylene terephthalate, most commonly used to make beverage bottles – trade at a premium to their fossil-derived virgin polymer.