What is Plastic Packaging Tax (PPT)?

Plastic is everywhere in modern life from food packaging and drink bottles to e-commerce deliveries. But with growing concern about plastic waste and its environmental impact, the UK government has introduced the Plastic Packaging Tax (PPT) to encourage businesses to use more sustainable alternatives.

If you’re a UK business that manufactures, imports, or uses plastic packaging, you may be wondering: What is Plastic Packaging Tax, who does it apply to, and how can you prepare?

This post hopes to break it down in plain English.

What is Plastic Packaging Tax?

The Plastic Packaging Tax (PPT) is a UK environmental tax that came into effect on 1 April 2022. Its purpose is to encourage businesses to use recycled plastic in their packaging and reduce the amount of virgin (new) plastic ending up in circulation.

The tax applies to plastic packaging manufactured in or imported into the UK that does not contain at least 30% recycled plastic.

• Tax rate:  £223.69 per tonne of plastic packaging (from 1 April 2025 – rates are usually updated each April).
• Threshold: Businesses manufacturing or importing less than 10 tonnes of plastic packaging per year are exempt.

HMRC – Plastic Packaging Tax Overview

Who Needs to Pay Plastic Packaging Tax?

You may need to pay PPT if you:

• Manufacture plastic packaging in the UK.
• Import plastic packaging (including packaging around goods, such as shrink wrap on pallets or bottles containing drinks).

Exemptions

Some plastic packaging is exempt, including:

• Packaging used for human medicines.
• Transport packaging used for imported goods (e.g., shipping containers, pallets).
• Packaging permanently designated for reuse (e.g., plastic crates).

Full list: HMRC – Packaging Exempt from PPT

Why Was Plastic Packaging Tax Introduced?

The UK uses millions of tonnes of plastic every year, with only a fraction being recycled. The tax is part of the government’s wider circular economy strategy, which aims to:

• Reduce reliance on virgin plastics.
• Increase demand for recycled plastics.
• Incentivise businesses to redesign packaging.
• Cut down on landfill and incineration.

This aligns with wider sustainability policies, such as the Extended Producer Responsibility (EPR) scheme and bans on certain single-use plastics.

More context: UK Government – Resources and Waste Strategy

How Does PPT Work in Practice?

Registration

• Businesses must register for PPT if they manufacture or import 10 tonnes or more of plastic packaging per year.
• Registration is via HMRC’s online service.
• Even if packaging is exempt, you may still need to register if you meet the threshold.
• Register for Plastic Packaging Tax

Record Keeping

Businesses must keep detailed records of:

• The weight of plastic packaging manufactured or imported.
• How much contains at least 30% recycled content.
• Exempt packaging and why it’s exempt.

Good record-keeping is essential – HMRC can audit your records.

Filing and Payment

Returns are quarterly (similar to VAT).

Tax is paid based on total taxable plastic packaging for that period.