The evolution of Europe’s plastic packaging taxes

Plastic packaging waste has become a pressing environmental challenge in Europe. Policymakers in the UK, Portugal and Spain have responded by introducing plastic packaging taxes to reduce such waste, increase recycling rates and support the transition to a circular economy. The effectiveness of these taxes depends on complementary measures and market conditions such as the availability of recycled plastics, material verification requirements and the price of virgin plastics.

This policy brief examines how governments design and implement plastic packaging taxes, drawing on evidence from the UK, Portugal and Spain. The author focuses on existing taxes, the realised and projected revenues they will generate, and early evidence of their impact.

Core insights

Policymakers who seek to address the costs of plastics, such as pollution and adverse health impacts, should account for several important factors:

• Evidence from the UK suggests that plastic packaging taxes can change producer behaviour, increase recycled content and decrease plastic packaging volumes.
• However, such taxes can be undermined by limited recycling capacity, substitution with alternative harmful materials and insufficient consumer education.
• Spain’s standardised certification for recycled content strengthens enforcement but leads to higher administrative costs, while the UK’s self-reported verification system poses traceability risks.

• Countries that have or are introducing a plastic packaging tax should use tax revenues and investment to scale up recycling and reprocessing infrastructure, build recycling capacity, stimulate ecological innovation and promote consumer education.
• They should also create robust, harmonised verification requirements for recycled content, embed these taxes in packaging policies that account for products’ entire lifecycle and consider introducing a uniform tax on all single-use packaging materials.

DOI: 10.21953/researchonline.lse.ac.uk.00138931