We have been asked a couple of times whether a plastic injection moulding component will be subject to the Packaging Tax. It can be confusing to understand if your product will be affected or not.
What is being taxed?
For the Plastic Packaging Tax, plastic is defined as a polymer material to which additives or substances may have been added. This also includes polymers that are biodegradable, compostable or oxo-degradable.
If a plastic packaging component is made from multiple materials but contains more plastic (including additives) by weight than any other substance, it will be classed as a plastic packaging component by the tax.
However, if the component is made with 30% or more recycled plastic, it is not chargeable for the tax.
Now if you have a plastic product that is not made from 30% or more recycled plastic, the answer depends on the function, and this decides whether it is in or out of the scope of the tax.
What are the categories?
The plastic packaging categories of functions and the examples from the GOV website are the following: