Innovate Blog
Is The Only Way Forward a Tax on Plastic?

Tuesday August 28, 2018

Ask the Expert: Jo Gilroy (Head of Sustainability).

We asked our Sustainability expert ‘Will Treasury taxes on single use packaging products really fix the problem and help to resolve the Ocean Plastic crisis?’

And here’s what she told us…

Sustainability Expert – Jo Gilroy Twitter – @JoannaGilroy

Last weekend, the Treasury published their summary report, providing an overview of the 162,000 responses to their call for evidence on whether taxes on single use packaging products could help tackle the plastic problem.  Amongst the responses included submissions from more than 220 diverse organisations, from manufacturers to environmental groups, retailers to recyclers, all bringing their expertise to the debate.   The report contains a number of well-articulated arguments but what it does not provide the reader with is a definitive answer as to whether product taxes are the right way to go.

In the summary report, the chancellor clearly articulates the treasury’s objective to explore “ideas to use tax to shift demand towards using recycled plastic in manufacturing, to encourage more sustainable design of plastic items and discourage those that prove difficult to recycle such as carbon black plastics, to reduce demand for commonly littered single use plastic items, including single-use coffee cups and takeaway boxes, and to ensure the right incentives are in place to encourage recycling of waste that is currently incinerated”.  Few would dispute the merits of this statement but can a tax achieve all of that?

In my opinion, any financial penalty (tax or levy) placed on single use packaging will only be effective if it remains connected to the outcomes we are all looking to achieve.  We want more packaging to be properly recycled and we want it to be easy to do so.  We want products to be more circular and contain recycled content, able to be recycled again and again.  And we do not want our green and blue spaces to be blighted by litter.

If we are to achieve this we need to invest in consumer education on what products can actually be recycled or composted.  We need to invest in recycling infrastructure, specifically in funding our island of entrepreneurs to innovate and reinvent the way we recycle.  Our recycling methods today are not necessarily the most effective.  If we take plastic as an example, made from hydrogen and carbon molecules, why can’t we recycle plastic back into its component parts?  Doing so would allow plastics to be recycled and remanufactured indefinitely.  Organisations in America are already demonstrating that this can be achieved.

One concern with a Treasury tax is that money raised will not be invested where it is needed..  In the summary report, the chancellor does state that the treasury are “committed to investing to develop new, greener products and processes funded from some of the revenues that are raised.  I would argue that a commitment of ‘some of the revenue’ needs improvement.  It should be all of the revenue.

Such an arbitrary packaging tax also runs the risk of undermining the great work already being achieved by the packaging supply chain and various retailers.  The summary report specifically singles out coffee cups, raising the expectation that these products will be taxed.  The industry led Paper Cup Recovery and Recycling Group (PCRRG) has been investing in credible solutions to make paper cup recycling easy to do and widely accessible for the consumer.  From financially investing in paper cup recycling facilities to developing new partnerships with the waste management sector.  As a result there are now 12 national waste providers offering paper cup recycling services.  A regularly updated list can be found on the Recycle More website.

A further consideration is identifying who is actually going to be paying this packaging tax?  It is most likely to be the consumer.  If the treasury wishes to change consumer behaviour, reduce demand and littering, then a packaging tax will have to be administered at the point of sale.  Is it necessary to penalised consumers when the packaging industry, manufacturers, distributors and retailers, have already committed to paying more to achieve similar aims?

Through the proposal by business to reform the Packaging Recovery Note (PRN) system, (a compliance tax already paid by business for the packaging they produce, distribute and sell), organisations have committed to pay more to recover single use packaging for recycling and composting, to fund consumer education campaigns and to impose heavy fines on products that cannot be easily and widely recycled.  Most importantly, the money raised through this system will be invested in developing and improving recycling and composting infrastructure.

The plastic problem must be fixed and swiftly.  Let us not repeat the mistakes of the past.  We must tackle the root causes of the plastic problem and not allow it to once more become an issue that is out of sight and out of mind because we have done our bit by simply paying a tax.

Image sourced from: