Sector ‘not ready for plastic tax’, says FPA

Following a survey amongst its members, the FPA (Foodservice Packaging Association) is warning that the sector is not ready for the Plastics Tax, due come into effect on 1 April.

The survey, conducted week commencing January 17 on the administration of the Plastics Packaging Tax (PPT), suggests almost 80% of FPA member companies who sell plastic packaging and products are not yet prepared to administer the tax. This is despite three quarters of respondents having attended an HMRC PPT webinar and/or read the tax guidance notes.

85% of those attending a HMRC webinar found it to be ‘unhelpful’, the FPA says, with ‘too many questions unanswered’.

HMRC should be concerned that if an informed group of businesses is unprepared…

Just over 50% are still unsure which of their packs and products are subject to the tax, the FPA says, with over 60% yet to work out a method for measuring recycled content, and over half not having implemented a system for recording recycled content.

Over 80% of those businesses importing packaging state that they will rely on their overseas suppliers for confirmation of recycled content, with less than 10% considering third party certification/evidence.
Invoicing requirements are causing great concern, the FPA says, with 77% of respondents unclear on requirements.

This could have been caused by HMRC’s original proposals for invoices to include plastic content and volume information for each pack on the invoice. Although the requirement has been removed for the moment, the initial proposal has left businesses ‘confused’, it says.

Level playing field

Only 23% disagree with the statement that ‘the cost of PPT administration will exceed what we pay’, a view no doubt formed by almost 70% of respondents having already appointed a someone with the sole responsibility of administering the tax or intending to do so.

While 38% agree with the tax’s intention to encourage recycled content, 84% expressed concern that some businesses will avoid paying the tax.
FPA says its members are ‘very aware’ of the tax and the Association says it has maintained a ‘steady flow of information’ to members.

Huge effort must go into ensuring a completely level playing field for this tax…

Executive Director Martin Kersh says: “HMRC should be concerned that if an informed group of businesses is unprepared, where does that leave the many businesses we suspect may not be aware of the tax or, if aware, have given no thought to setting up procedures to manage the tax?

“We think some importers, traders on portals and parts of the economy are unaware of what they consider to be products that are defined by HMRC as packaging.

“We intend asking HMRC to step up the provision of information and ensure there is greater clarity in the guidance. We know that new taxes take time to bed in, however, there is clearly a feeling among members that the good guys will spend the money and time to comply but there are far too many businesses outside of our immediate sector who might not.

“Huge effort must go into ensuring a completely level playing field for this tax and we hope the HMRC PPT team is given the resources to achieve this.”

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