Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what steps he is taking to ensure that the forthcoming plastic tax has an equitable administrative and economic effect on businesses in the bioeconomy.

On 12 November, the Government published the summary of responses to the recent consultation on the detailed design and implementation of the Plastic Packaging Tax. This included confirming the consultation proposal to include compostable and bio-based plastic packaging in the scope of the tax. As set out in the consultation, all packaging, including that which is 100% compostable, will be in scope of the tax if plastic is the predominant material by weight.

As set out in the summary of responses to the consultation, the Government believes that alternative plastics can play a role in addressing plastic waste if used in the right circumstances. However, further evidence is needed on the impact of widespread adoption of such materials, and it is right to include them within scope of the tax at this stage. As part of the Bioeconomy Strategy, the Government is working with industry and the research community to better understand the impact of using bio-based, biodegradable and compostable plastics. Following the conclusion of the Bioeconomy Strategy, the Government will consider further the treatment of these plastics in relation to Plastic Packaging Tax.

The Government carefully considered the impacts of the tax when making the decisions set out in the summary of responses to the consultation. More information on impacts is available in the Tax Information and Impact Note - https://www.gov.uk/government/publications/introduction-of-a-new-plastic-packaging-tax/introduction-of-a-new-plastic-packaging-tax. To support businesses, HMRC will develop clear guidance and other tools to help businesses understand and meet their obligations.

Alongside the summary of responses to the consultation, draft legislation for the Plastic Packaging Tax was also published. The Government continues to engage with businesses involved in the manufacture and import of plastic packaging to ensure the legislation is fit for purpose and the tax can be successfully introduced in April 2022.