Veolia urges Government to boost Plastic Packaging Tax

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Resource management company Veolia has called on the Government to increase the Plastic Packaging Tax to encourage more use of recycled content in plastic packaging and support the development of domestic recycling infrastructure.

Veolia commissioned research by climate action NGO WRAP to assess the economic and environmental impacts of raising the Plastic Packaging Tax. 

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The tax will charge £217.85 per tonne on plastic packaging that contains less than 30% recycled content from 1 April 2024, but Veolia argues that this is not enough to stimulate the end markets for recycled plastics, as only 22% of material used in plastic packaging is from recycled sources.

Veolia proposes that the Government should increase the Plastic Packaging Tax to 35% recycled content and £275 per tonne this year, and then gradually raise it to 50% and £500 per tonne by 2030. 

This would create a strong incentive for brands and producers to use more recycled content in their packaging, as well as give investors confidence to build new plastic sorting and reprocessing facilities in the UK, Veolia believes. 

According to Veolia’s report that makes the recommendations, Resource the Future, this would enable an investment of £1.1 billion in building ten new plastic sorting and 30 new plastic reprocessing plants, creating 2,500 new jobs and reducing annual carbon emissions by 1.8 million tonnes of CO₂ equivalent.

The company also claims that escalating the Plastic Packaging Tax would align the UK with the European Union legislation, which is targeting mandatory recycled content, rather than incentives, reaching up to 65% by 2040. 

Veolia’s call for action is supported by a survey conducted by YouGov in February 2024, which found that 82% of UK adults would like to see more recycled content in the packaging they buy. The company says that consumers are increasingly demanding more sustainable products and packaging, and that the Government should respond by boosting the Plastic Packaging Tax and supporting the circular economy.

Veolia senior executive vice president Northern Europe Zone Gavin Graveson said: “The recycled plastic industry cannot be ignored if we are serious about building a green economy. The Plastic Packaging Tax is a crucial lever to stimulate growth in the sector, but it needs recalibrating so we create a market where it is cheaper to be sustainable and more expensive to pollute by using virgin polymers.

“We need to bring thousands of tonnes worth of recycling capacity online – and fast. But this can be a great opportunity for the Government to unlock private investment, new jobs and carbon savings. Backing green policy isn’t a zero sum game.”