HM Treasury: Reforms to Plastic Tax to boost chemical recycling
HM Treasury announced plans to launch a consultation on changes to the Plastic Packaging Tax (PPT) which it hopes will encourage investment in chemical recycling. To recognise the potential role of chemical recycling, help drive demand for this higher quality recycled plastic and boost investment in advanced recycling, HM Treasury and HMRC announced that the consultation will be launched on the use of a ‘mass balance approach’ for PPT.
This is a way to calculate the recycled content in packaging made from chemically recycled plastic, so it can contribute to the 30% recycled content threshold above which no tax is due. The consultation will garner feedback on whether to allow a “mass balance approach” for calculating the proportion of recycled content in chemically recycled plastics for the PPT.
Chemical recycling is the process of converting polymeric waste by changing its chemical structure and turning it back into substances that can be used as raw materials for the manufacturing of plastics or other products The PPT was introduced last year and sits alongside other reforms to tackle plastic waste.
The government explained that, unlike traditional mechanical recycling, chemical recycling can break down plastic waste to a molecular level to produce feedstock which can be used to produce new plastic.
This means it can offer a complementary route for plastic waste which can’t be mechanically recycled, reducing amounts going to incineration or landfill. It can also produce a higher quality of recycled plastic. The government says the consultation will be launched later this year (2023).
