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Tax on virgin resin packaging and the funds raised can only be used for plastic recycling – Maypak

In the United States, huge amounts of money are invested in solving the problem of plastic recycling. When it comes to obtaining these expenditures, taxes are imposed on plastic packaging that uses virgin resin and does not contain recycled content.

At the same time, the British government proposes to impose a tax of 200 pounds per ton on virgin resin plastic packaging produced and imported in the country.

The U.S. and U.K. governments begin to consider levying taxes on virgin resin packaging materials

According to a recent report released by the industry-sponsored recycling cooperation organization, the United States will invest US$17 billion in response to the plastic problem within five years, which may bring about significant improvements, of which US$4 billion will be used to dispose of plastic film waste generated in residential buildings.

But there is still something worth discussing on how to pay the fees. An idea to close the gap has gradually emerged-a tax on virgin resin in plastic packaging that does not contain recycled content. This idea may sound extreme in the United States, but it has attracted attention elsewhere.

The British government has already put forward this proposal, and consumer goods companies in the country have also generally put forward the idea of ​​charging for resin.

The United Kingdom proposes to impose a tax of 200 pounds per metric ton of plastic packaging produced in or imported into the country, except for packaging with a rate of more than 30% filled with recycled materials.

In the United States, according to calculations, the approximate estimated price will be US$250 per ton, or 12.5 cents per pound. Most plastic packaging currently sells for 80 cents to $1.20 per pound (it is worth mentioning that this price is already the highest in history). To deal with such a high price, manufacturers will definitely think this is crazy.

Why increase the price substantially? Is the company willing?

A substantial increase in prices will raise a large amount of funds to improve the recycling infrastructure and make the plastic packaging recycling rate higher than the 14% currently calculated by the U.S. Environmental Protection Agency. This value itself is too small! To this end, a strong price signal is issued, which is conducive to the use of recycled materials and more recyclable plastic packaging.

But it must be clear: the funds raised are used and can only be used for plastic recycling. For example, the federal gasoline tax will go to the highway trust fund. Some people think that this will create a management burden on the company. But in the eyes of industry insiders, this is true for any major improvement attempt. Plastics industry organizations said they are in favor of expanding the manufacturer’s responsibility plan, although this will increase management costs for the company.

Government policy has always involved recycling. The PET recycling business started with the “bottle bill” policy in the 1970s, and the tax collected was used to recycle roadside garbage and re-enter industrial production. The tax policy has always reflected our social values. In this case, the tax policy adopted to support recycling is not so extreme, and using its advantages to use recycled plastics to promote the recycling of packaging can avoid taxation. If chemistry or more advanced recycling technologies continue to make progress, these taxes will inevitably fall.

So what are the sources of the total tax amount?

According to estimates by the U.S. Environmental Protection Agency, taking the packaging industry as an example, approximately 8.4 billion pounds of plastic bags and packaging films are produced every year. Using it as the total output of flexible packaging, calculated at a resin tax of 12.5 cents, will raise $1 billion per year. The amount is announced by the recycling cooperation organization and used to pay for the recycling of waste soft plastics on the roadside within five years.

The Plastics Industry Association recently held an annual Washington lobby for member companies, where recycling and sustainability are one of the key topics. Industry lobbyists hope to fund recycling in the infrastructure plan being debated in Washington.

In the case of rising federal deficits, this tax advantage will not make the government’s fiscal situation worse, and recycling is a good selling point in Washington’s new spending.