The plastic tax is built to be seen, not to work: our take on the Packaging Recovery Note (PRN) problem
The UK’s packaging taxes have survived years of complaints from retailers and manufacturers because they were never designed to lift recycling.
Our founder and CEO, Mike Coppen-Gardner, set out why in The Grocer, and we think he has the diagnosis and the cure right.
Follow a single plastic bottle through the system. If it holds less than 30% recycled plastic, its manufacturer pays the Plastic Packaging Tax, now £228.82 a tonne. The brand selling it pays a collection fee, £423 a tonne in the scheme’s first year, and then buys a Packaging Recovery Note (PRN) to prove the bottle was recycled. From October 2027 a deposit return scheme adds a fourth charge.
Nobody planned it this way. Each charge arrived separately, so the same material is taxed several times over, and PRN prices have in some cases more than trebled since January. The British Retail Consortium’s director of policy, Tom Ironside, says the overlapping taxes cost retailers and manufacturers billions. The regime has outlasted every complaint anyway.
The reason is largely political: a producer levy lets ministers be seen acting on plastic while the cost reaches shoppers through prices no voter can trace to a policy, which is why the Plastic Packaging Tax has gone up every April since 2023 under Conservative and Labour governments alike. But the results are pretty thin. England’s household recycling rate was 43.8% in 2024, down from 44% the year before, and almost half of the UK’s accredited plastic recycling is shipped abroad and counted as recycled on arrival. Billions in, a flat line out.
Public opinion keeps the regime in place. Ipsos found in 2018 that seven in eight Brits were at least fairly concerned about plastic waste, yet only 14% would pay more council tax for better recycling. A policy that earns credit and rarely costs votes is hard to give up. Ask anyone at a checkout what the plastic tax is for and they will probably say it pays for recycling, but the PRN system gives that belief little support. The money moves through a certificate market where scarcity sets the price, and the only account of where it went comes from the reprocessors themselves.
Industry has argued its case carefully in consultation responses, but not to the people at the till. While shoppers believe the plastic tax is working, government will keep reaching for the sticking plaster. The trade bodies’ call for regular published recycling data is the best idea on the table, and companies do not have to wait for Whitehall to act on it. Those calling for PRNs to be scrapped already know what they pay and what recycling has delivered in return. They could share those figures with customers tomorrow, although no retailer wants to be first to admit that the green taxes on groceries have not done what was promised.
Scrapping PRNs is the right policy, but the argument will be won in the aisles before it is won in the Treasury, or not at all.
You can read Mike’s full piece in The Grocer, where it ran as the Saturday Essay on 31 October.
SPQR is a digital-first strategic communications agency that works with organisations in contested sectors to measure and close the gap between what they can prove and what their audiences believe. If you are building the evidence, we can help build the belief.
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