Introduction

In the chemical recycling process, plastic is broken down to its molecular level and often mixed with virgin material, making it impossible to differentiate or test for recycled content post-production. The current Plastic Packaging Tax (PPT) requirements stipulate the exact amount of recycled content in each component must be accounted for, which is not possible for material containing chemically recycled content.

Chemical recycling methods can produce high-grade recycled plastics from a wider range of polymers than traditional mechanical approaches. However, the chemical recycling industry in the UK is still in its infancy, so plastic waste that can’t be mechanically recycled (but could undergo chemical treatment) is often sent to landfill or incineration.

On 18 July 2023 HMRC released a consultation asking stakeholders whether a mass balance method should be permitted when calculating recycled plastic content in relation to the PPT, and how it should be managed if allowed. If permitted, it would be possible for manufacturers and importers to prove the requisite 30% recycled content when using chemically recycled plastic, which in turn could help to stimulate the chemical recycling market.

This article explains what the consultation is considering and how to respond.

Timelines

The plastic packaging tax has been operational since April 2023, and charges manufacturers and importers of plastic packaging £210 per tonne for packaging produced with less than 30% recycled content. It was introduced with the aim to encourage the use of recycled material and the UK plastic recycling industry.

Consultations in relation to the tax so far include:

• Call for Evidence - March 2018
• Plastic Packaging Tax Policy Design Consultation - February 2019
• Plastic Packaging Tax Policy Design Consultation - March 2020
• Plastic Packaging Tax mass balance consultation - closes 10 October 2023

Mass balance

Mass balance is a ‘chain of custody’ model used in a variety of industries used to track materials through complex supply chains. It works by calculating the percentage of a given input (such as recycled plastic) in relation to the total input and allocating it accordingly to the outputs.