Plastic Packaging Tax

The measure

The government has today updated its policy paper on the introduction of UK Plastic Packaging Tax (PPT) to refer to proposed additions to the primary legislation. The changes are broadly intended to clarify how the tax is expected to operate and do not substantively change the intended structure or function of the tax. 

The amendments will:

  • Enable HMRC to introduce secondary legislation to change the timing of an import, and the meaning of import and customs formalities so as to align the tax with other policies (e.g. customs law and freeports);
  • Ensure that businesses below the PPT de minimis threshold, who currently do not have a liability to register, do not have to pay the tax;
  • Provide relief for persons enjoying certain immunities and privileges, such as visiting forces and diplomats;
  • Transfer the obligations and entitlements of PPT group members, such as completing returns, to the representative member of that group;
  • Require HMRC to notify the representative member of a PPT group of the date that applications for and modification of group treatment will take effect; and
  • Change certain terms used to describe unincorporated bodies to ensure consistency throughout the legislation.


Who will be affected?

Businesses that will either be liable to register or account for PPT from 1 April 2022.


When will the measure come into effect?

The proposals are expected to be included in the Finance Bill 2021-22 and will amend the Finance Act 2021 from the date of the Bill’s Royal Assent. We expect the changes to be made prior to the entry into force of PPT on 1 April 2022 but, as with all legislation passing through UK Parliament, it is difficult to accurately predict when it will become law. It is also possible that the proposals could be amended prior to passing into law.

Our view

Whilst today’s proposals are reasonably few in number and narrow in scope, they do suggest that HMRC is turning its focus to the potential practical implications of PPT. This will be welcomed by affected taxpayers given the short timeframes prior to the implementation of PPT and the relative lack of other practical information, including long-awaited regulation concerning how the tax will be administered.