Ecoveritas cautions against revenue-boosting being the focus of Plastic Tax fine-tuning.

Ecoveritas, an environmental compliance specialist, has advised businesses to take heed of the Plastic Packaging Tax (PPT) non-compliance penalties introduced by HM Revenue and Customs (HMRC). Though Ecoveritas supports the penalties, it stresses that any changes to the PPT must not solely benefit the Treasury.

The Plastic Packaging Tax, implemented in April 2022, mandates the payment of a levy on plastic products containing less than 30% recycled content. Recently, the government made significant changes to the PPT, increasing the rate to £210.82 per tonne, thereby aligning it with the Consumer Price Index (CPI) from 1‌‌‌st ‌‌April 2023. The invoice statement is no longer mandatory.

As part of the Finance Bill, the government is implementing technical changes to PPT penalties. Kathy Illingworth, the Head of Sustainability & Consulting at Ecoveritas, commented on HMRC’s PPT enforcement: “This is a significant shot across the bow from HMRC, who are keen to emphasize that falling short of the expectations will prove expensive to business.”

The Treasury had forecasted £300 million in revenue but collected £206 million even though only 4,000 of the anticipated 20,000 manufacturers and importers have registered for the tax. Illingworth warns that there is still a significant amount of work to be done to understand eligibility.

“It’s clear that HMRC will not only be penalising companies that are not compliant but are also planning to penalise businesses that are late with returns and those that submit inaccurate information,” added Illingworth. “Our message would be to give this the appropriate level of focus, and we will work closely with our clients to ensure they are across all the latest developments. These penalties shouldn’t be taken lightly, and the latest guidance outlines the serious consequences for failing to register when you should!”

If your company has manufactured or imported 10 tonnes or more of plastic packaging in the last 12 months or expects to in the next 30 days, you must register for the Plastic Packaging Tax.