UK Plastic Packaging Tax Laggards Face Fines

Despite HMRC estimating that up to 20,000 UK businesses would be affected by the government’s new tax on plastic packaging, just 992 companies have signed up to pay, according to law firm Pinsent Masons. Non-compliance could lead to fines, presenting a double-whammy to directors and investors of firms unaware of their obligations. The Plastic Packaging Tax applies to UK companies that manufacture or import ten or more tonnes of plastic packaging in the year starting 1 April. Those that don’t comply are at risk of facing “substantial penalties” from HMRC, the law firm warned. Despite HMRC forecasting that the first year of the tax would generate £235 million in revenue, the low number of companies signed up to pay makes that unlikely, the law firm said. Businesses may be unaware that this is a requirement, Pinsent Masons said. Further, what constitutes plastic packaging is “not always obvious”, the firm said. Abigail McGregor, Legal Director at Pinsent Masons, said: “Many are unaware the products they make or use are within the scope of the tax, or that they could be liable if another member of their supply chain fails to pay. Although HMRC are unlikely to impose hefty penalties for innocent non-compliance immediately, unfortunately, being unaware of a new tax will not stop HMRC from investigating your business and levying penalties for any underpayments or failure to register and make returns in the longer term. Businesses that ignore the Plastic Packaging Tax may be in for a nasty surprise.”

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