Beginning 1st April 2022, The UK Government and HMRC are introducing The Plastic Packaging Tax which will apply a £200 per tonne tax on all liable plastic packaging components manufactured or imported into the UK.
There are some exceptions to the tax such as where a minimum of 30% of product weight is made up of recycled material. Any plastic packaging that does not incorporate a minimum of 30% of reprocessed materials will incur a £200.00 per tonne Plastic Packaging Tax (PPT). £0.20 per gram per 1000.
e.g., a cap weighing 3 grams, will be chargeable at £0.60 per 1000 + VAT.
The 30% recycled content threshold applies to each component and cannot be averaged across multiple packaging components. It also applies to composite materials where plastic is the heaviest material.
Exemptions
We would like to highlight some exemptions to the tax that could be relevant when making your tax returns from 1st July 2022 onwards. These can be viewed online at: https://www.gov.uk/guidance/check-which-plastic-packaging-is-exempt-from-plastic-packaging-tax
Medicinal Products
One of these exemptions applies to plastic packaging that is used for human medicinal products. The guidance from HMRC states that any plastic packaging imported or manufactured for the immediate packaging of licenced human medicinal products is exempt from the tax.
‘Immediate packaging’ is defined by HMRC as a container (or another form of packaging) that will be in direct contact with the medicinal product once it is produced and packed.
A medicinal product is defined as a product that is for use by people to:
- prevent or treat diseases.
- restore, correct, or modify a physiological function by exerting a pharmacological, immunological, or metabolic action.
- make a medical diagnosis.
A medicinal product must be licenced by the Medicines and Healthcare Products Regulatory Agency to count as a human medicinal product.
Plastic packaging that is designed to be an integral part of the goods
Plastic packaging components which are an integral part of the goods are not subject to Plastic Packaging Tax and you do not need to account for them on your tax return.
A packaging component is an integral part of the goods where both the:
- goods cannot reasonably be used or consumed without the component.
- component is expected to be discarded once the goods (of which it is a part) are used, consumed, or discarded.
Some relevant examples include:
- droppers and pipettes, such as for eye drops and flea treatments.
- pump containers for toothpaste (but not toothpaste tubes).
- the rollerball of roll-on deodorant.
- aerosol actuators.
- mascara brush, wand, and cap (but not the bottle).
If you have any queries about this tax, please do not hesitate to contact us for further assistance.
