Plastic Packaging Tax: the potential killer of your profits!

Calculating import duty and Vat on your shipment is easy to when moving goods through the border – as you cannot avoid paying it during customs clearance – but did you know that you could be liable for a different, significant kind of import tax from April 1st? Plastic Packaging Tax (PPT) is a new tax that is levied on both manufacturers and importers, and could be a silent killer of your profit margins if not accounted for now.

Am I liable for Plastic Packaging Tax?


Whether or not you are liable for Plastic Packaging Tax depends on a few things: 

– The type of plastic packaging you use when importing/manufacturing.

– How much of it you import/manufacture.

– The timeline that you do it in.

You will be liable for PPT if your company imports or manufactures over 10 tonnes of finished plastic packaging components within a 12-month period. This means that you will not be liable for PPT if your amount is under this. However, if you cross the threshold then you will need to pay Plastic Packaging Tax for the first 10 tonnes.

(Note that only the importer/manufacturer is liable for PPT – this cannot be passed onto the next buyer)

Your plastic component is categorised as a finished article if it has finished all substantial modifications – a process that changes the weight, shape, structure, or thickness of the piece.

Some examples of substantial modifications are:

– Forming: where the article is heated and reshaped.

– Extrusion: where raw plastic is pressed into shape.

– Moulding: where plastic is put into a mould to create a new shape.

– Laminating: where 2 or more layers are combined into a new article.


The following are not substantial modifications:

– Labelling or Sealing: where a label or film is applied to an article.

– Blowing: where the component has hot air blown in to create a predetermined shape.

– Cutting: where a larger piece is separated into many articles.


How much is PPT?

Plastic Packaging Tax is based on the weight of your finished components only – the remaining weight of your goods do not contribute towards this. You need to pay PPT if you import or manufacture over 10 tonnes of finished plastic components within any 12-month period (not per calendar or tax year).
The current rate of PPT is £200 per tonne of finished components imported or manufactured. This means a minimum of £2000 if you exceed the 10-tonne threshold.
Note that payment of PPT must be done by your accountant. It is not included in the customs clearance process or something that your customs broker can arrange.


Need help with Plastic Packaging Tax?

Plastic Packaging Tax is not levied during customs clearance, so Universal Customs Clearance are unable to give specific advice on PPT. Speak to your tax advisor or check out this government legislation for more information. For anything customs related, please contact us for more information.


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