ICAEW.com works better with JavaScript enabled.

TAX NEWS

HMRC consults on changes to plastic packaging tax

Article

Published: 07 Aug 2023 Update History

The consultation explores the application of a mass balance approach to determine the amount of chemically recycled plastic in plastic packaging.

Plastic packaging tax (PPT) is not charged on plastic packaging components that contain at least 30% recycled plastic. In theory, chemically recycled material can contribute to meeting this 30% requirement. In practice, the way that chemical recycling is carried out means that it is not always possible to determine the actual amount of recycled material in a specific output. As a result, some plastic packaging that contains at least 30% recycled plastic will be incorrectly subject to PPT. 

HMRC has launched a consultation to consider the application of a ‘mass balance approach’ as a possible solution to this problem. A mass balance approach would allow recycled plastic that is mixed with virgin plastic to be allocated to a particular output. This would enable more recycled plastic to qualify for relief from PPT. 

The government is seeking views on whether a mass balance approach should be approved as a method of allocating recycled content for the purpose of PPT. The consultation also considers what controls would be required. This includes the possible introduction of a certification scheme to ensure businesses using chemical recycling comply with any requirements. 

ICAEW’s Tax Faculty intends to respond to the consultation and is seeking views from its members with knowledge in this area. Comments on any of the questions in the consultation should be emailed to Ed Saltmarsh by 19 September 2023. 

The Tax Faculty

ICAEW's Tax Faculty is recognised internationally as a leading authority and source of expertise on taxation. The faculty is the voice of tax for ICAEW, responsible for all submissions to the tax authorities. Join the Faculty for expert guidance and support enabling you to provide the best advice on tax to your clients or business.

More support on tax

ICAEW's Tax Faculty provides technical guidance and practical support on tax practice and policy. You can sign up to the Tax Faculty's free enewsletter (TAXwire) which provides weekly updates on developments in tax.

Sign up for TAXwireJoin the Tax Faculty

More from the Tax Faculty

Latest news
Making tax digital image
TAXwire

Stay up to date with the latest developments in tax by signing up to the Tax Faculty's weekly e-newsletter

Practical guidance
Cover
TAXline

Comprehensive support for Tax practitioners each month from the Tax Faculty and expert contributors.

Technical support
Tax Faculty image
Webinars

Expert advice from the Tax Faculty's technical managers on all the developments in tax policy and practice.

Open AddCPD icon

Add Verified CPD Activity

Introducing AddCPD, a new way to record your CPD activities!

Log in to start using the AddCPD tool. Available only to ICAEW members.

Add this page to your CPD activity

Step 1 of 3
Download recorded
Download not recorded

Please download the related document if you wish to add this activity to your record

What time are you claiming for this activity?
Mandatory fields

Add this page to your CPD activity

Step 2 of 3
Mandatory field

Add activity to my record

Step 3 of 3
Mandatory field

Activity added

An error has occurred
Please try again

If the problem persists please contact our helpline on +44 (0)1908 248 250