UK plastic packaging tax raises US$337M but sidelines bio-based materials: HMRC

UK – Duo Packaging has criticised the UK’s Plastic Packaging Tax for treating bio-based plastics in the same way as fossil-based materials, as HMRC data shows the tax accrued £250 million (US$337 million) in 2025-26 while the UK government confirmed a mass balance approach for chemically recycled plastic will take effect from April 2027.

HMRC data reveals that taxable packaging accounted for 37 percent of the total 2.97 million tonnes of plastic packaging declared in 2025-26, down from 41 percent in 2022-23, with the number of registered businesses standing at 5,142 as of 13 August 2026. 

The tax rate rose to £228.82 per tonne from 1 April 2026. 

Bio-Based Plastics Disadvantaged by Recycled-Content Focus

Duo Packaging argues the tax “incentivises the use of recycled plastic, which is a good move, but does so in a very blinkered way,” according to brand director Zoe Brimelow. 

The UK-based provider estimates that the 5.8 million metric tonnes of packaging declared with 30% or more recycled content since the tax’s introduction has a carbon footprint of 13.90 million metric tonnes CO₂ equivalent, 3.26 million tonnes less than virgin plastic.

However, Duo contends the same volume could have been “carbon negative” if bio-based alternatives were exempt. 

The British Plastics Federation notes that incorporating 30% recycled content is technically or legally difficult in some cases, while Ecosurety has raised concerns over enforcement and material scope.

Government Policy and Future Changes

The UK government states the tax aims to “increase demand for recycled plastic and in turn stimulate increased levels of recycling and collection of plastic waste, diverting it away from landfill or incineration.” 

Officials have cited a “lack of consensus” among academics and industry over the environmental benefits of bio-based plastics. 

From April 2027, a mass balance approach will be introduced to account for chemically recycled plastic, while pre-consumer waste will no longer qualify as recycled content. 

Duo’s Brimelow suggests treating low-carbon, bio-based materials in the same way as packaging containing at least 30% recycled plastic, adding that some tax revenue could be invested in bio-based plastics or other advanced materials.

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