Clearly, the pressure on governments to take climate action is increasing: each Friday, students all over the world strike to demand such action, Ireland and the UK have become the first two countries to declare a climate emergency and Australia’s upcoming election has been dubbed the “climate change election”. 

Tax measures to drive behavioural change are likely to form part of the response of governments considering what action they can and should take. In this vein, a recent recent ACCA paper entitled "Tax as a force for good" advocated a gradual, but sweeping, shift of the tax burden from labour to pollution and resource-use in order to support the development of circular economies. The future of such a bold proposal may be questionable, but green taxes look to be on the rise – in particular in the UK which, amongst Sweden, Finland, Denmark and the Netherlands, was referred to in the paper as a “trailblazer” . 

Whilst UK legislation already provides for a range of green taxes (including air passenger duty, landfill tax and the climate change levy), the UK government has recently consulted on the design of a new and world-leading plastic packaging tax to be levied from 1 April 2022. 

The UK government’s preferred approach is a flat-rate tax per tonne of product to be imposed on manufacturers and importers of plastic packaging that does not contain at least 30% recycled content. Exports of plastic packaging and imports of filled packaging would not be subject to the tax, and a de minimis threshold (subject to anti-fragmentation rules) is envisaged. In order to ensure compliance, the UK government may make manufacturers/importers, pack-fillers, brands and retailers jointly and severally liable for the tax. It is intended that the introduction of the plastic packaging tax will sit alongside a reform of the existing packaging producer responsibility system under which companies that handle packaging and meet certain thresholds are required to demonstrate that a certain amount of packaging is recycled. 

The UK government’s proposals are ambitious and to be taken seriously - the UK government has stated that, if the announced policies do not deliver, the introduction of a tax on the incineration of waste (to operate alongside landfill tax) will be considered. 

This will be music to the ears of some; it certainly seems to fit with the zeitgeist and will cement the UK’s position as a trailblazer on green taxes.