Extracts from Commons proceedings: Plastic Packaging Tax - May 18

Extract from Westminster Hall debate on Plastic Pollution in the Ocean

Fleur Anderson (Putney) (Lab):...That is important, because it is about priorities, focus and action, and I am sorry to say that priorities, focus and action have not been the order of the day with this Government in Westminster. The Conservatives have been in power for 13 long years, but have left the agencies that should tackle waste and pollution underfunded and understaffed. No wonder we have not seen the action that we need. We have seen the mess that has been caused with sewage pollution. The Environment Agency has struggled to tackle waste crime and monitor waste exports, and councils are struggling to deal with waste effectively while cutting waste collections. Government Members shamefully voted against Labour’s amendments to the Finance Act 2021 on a plastic packaging tax  which would have required the Government to pay due regard to the principles of waste hierarchy and a circular economy. The Conservatives are weak on tackling the effects and causes of all waste. Labour would take the issue seriously. Action is a no-brainer, and we have to get on with it...

For context, OPEN HERE

Extracts from committee stage of the Finance (No. 2) Bill

The Financial Secretary to the Treasury (Victoria Atkins):...We will deal with the plastic packaging tax later in the Bill. The latest figure is just over £200 per tonne. As with the landfill tax, it will sit alongside this scheme and the whole point is to, first, cut down on plastic and secondly, make sure that less of it goes to landfill. I very much hope that people will see this as a holy trinity of environmental measures to try and achieve the ends that we are all so keen to achieve. Unless there are any further takers, I will sit down..

The Exchequer Secretary to the Treasury (Gareth Davies):...Turning to clause 328, the plastic packaging tax aims to provide businesses with a clear economic incentive to use more recycled plastic in packaging. That will increase demand for recycled plastic and stimulate recycling and collection of plastic waste, diverting it away from landfill or incineration. The clause maintains the real-terms value of the price incentive to use more recycled plastic by increasing the plastic packaging tax rate in line with the consumer prices index. The clause increases the rate from £200 per tonne to £210.82 per tonne, with effect from 1 April 2023...

James Murray (Ealing North) (Lab/Co-op):...Clause 328 increases the plastic packaging tax in line with the CPI. The plastic packaging tax was introduced in April 2022 to provide an economic incentive for businesses to use recycled plastic in the manufacture of plastic packaging. That was expected to create greater demand for the material, which would in turn stimulate increased recycling and collection of plastic waste, diverting it from landfill or incineration. I understand that the new rate maintains the real-terms value of the incentive to include 30% or more recycled plastic and plastic packaging components in a product by increasing the rate of tax in line with the CPI. As that tax has now been in place for a year, what evaluation have the Government made of it? In particular, can the Minister tell us what impact the tax had in 2022-23, in terms of fulfilling its stated aim of stimulating increased recycling and collection of plastic waste?

Gareth Davies:...Let me mop up the question asked by the hon. Member for Ealing North about a review of the plastic packaging tax  He is right to raise that. We will be conducting a review very soon, but we are clear that we would like a decent period in which to conduct it so that we can see a clearer picture of the impact the tax is having. I can assure him that a review will be conducted very soon...

James Murray:...I thank the Minister for his commitment to a review of the effectiveness of the plastic packaging tax and for his clarification of some of the statistics around the tax gap. Comparing the figures that he cited with the figure of 17.1% for landfill tax fraud shows just how big the tax gap is for landfill tax fraud, and how important it is that specific action be taken. Will he explain what specific action, rather than just talk about generalities, is being taken on landfill tax fraud, which we all agree is a problem that must be tackled?

The Financial Secretary to the Treasury (Victoria Atkins):...Finally, clause 337 relates to the plastic packaging tax  Currently, late payments in respect of plastic packaging tax by liable businesses and businesses that are held secondarily liable or joint and severally liable incur the same penalties. In contrast, late payments of assessments made by HMRC where a business has failed to submit a return incur different penalties. Clause 337 addresses that anomaly and amends schedule 56 to the Finance Act 2009, so that all late payments of plastic packaging tax incur the same penalties...

James Murray (Ealing North) (Lab/Co-op):...Finally, clause 337 amends schedule 56 to the Finance Act 2009, to align inconsistent late payment penalty provisions and ensure that all businesses liable for a late payment penalty in respect of the plastic packaging tax are charged the same penalty, however that liability arises. As we discussed earlier, the plastic packaging tax was introduced from 1 April last year to provide an economic incentive for businesses to use recycled plastic in the manufacture of plastic packaging, which was intended in turn to create greater demand for that material. The clause introduces a technical, administrative change and we will not oppose it...

For context, OPEN MORNING SESSION HERE

For context, OPEN AFTERNOON SESSION HERE