The advance towards EU taxing on virgin plastic

Amsterdam, 28 November 2018– Is there even basic political support for a European tax on virgin plastic? It would appear so. Günther Oettinger, European Commissioner for Budget and Human Resources suggested just this, last January already. The EU Green Party also began a campaign this year for the introduction of a tax on plastic manufacturers. At the very same time, the packaging industries are leading strong lobbying aimed at preventing any kind of tax on plastic and advocating purely voluntary measures being taken, if any.

The European Commission (EC) wants to see much more plastic being recycled. There is no announcement of any tax to stimulate that at all in the Plastics Strategy. Instead, the EC required the industry to promise to clean up their act, on a voluntary basis, just this last summer. From among the 65 pledges received by the Commission, it transpires that European recyclers in 2025 could recycle 10 million tonnes of plastic. However, going on this week’s press release on the subject, the EC has identified a huge problem. They may very well say there are 10 million tonnes of plastic for recycling, but there is only actual demand for 5 million tonnes.

Plastic manufacturers want to (re)use only good quality recycled plastic. Frans Timmermans, European Commissioner for Better Regulation (etc.) said: “We will now analyse which should be the next steps to further boost the uptake of recycled plastics and close the gap between supply and demand”. From the press release, it appears that this further analysis, to be published by the EC early 2019, does not exclude new laws and economic incentives. Nicely bringing tax on virgin plastic into the picture.

The discussion on levies for virgin plastic has been given a boost within the UK recently. The core message taken from last week’s report as distributed among UK MPs is that companies are taxed specifically when they use non-recycled plastic, or plastic with too low a percentage of recycled content. The report was written for the WWF and Resource Association, by the Eunomia advisory.

This suggested method of operation will make it more expensive to make new (packaging) plastic. Meaning, an overall reduction in the amount of plastic, a reduction in the use of raw materials, and a reduction in CO2 emissions besides. On the other side of the coin, it makes it financially more attractive to make and use recycled plastic, given that that will remain free of any levy.

Maria Westerbos, MD of The Plastic Soup Foundation says: “We have long advocated a tax on primary packaging plastic. We urgently call upon the Dutch government to show their hand, anticipate this trend and lead the way in support of the levying of a tax on virgin plastic within Europe.”

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