The UK’s Plastic Packaging Tax (PPT) is not new, having been in effect since April 2022. As of November 2025, the tax is applied at a rate of £223.69 per tonne on plastic packaging components that contain less than 30% recycled plastic. The new policy changes were recently announced on 26 November 2025, but they will not be implemented until 2026 and 2027.
The Autumn 2025 Budget announced several future changes to the PPT:
- Rate Increase (April 2026): The PPT rate will increase to £228.82 per tonne from 1 April 2026, in line with CPI inflation.
- Mass Balance Approach (April 2027): To be taken for calculating the recycled content of chemically recycled plastic will be allowed from 1 April 2027, enabling businesses to claim an exemption for this material.
- Removal of Pre-Consumer Waste (1 April 2027): Pre-consumer waste will no longer be considered a source of recycled plastic for PPT purposes. This is intended to close a loophole and incentivise the recycling of post-consumer waste.
- Consultation on Certification (Early 2026): The government will launch a consultation in early 2026 to explore mandatory certification for mechanically recycled plastic, to address compliance concerns.
The current rate of £223.69 per tonne is applied to nearly 5,000 registered businesses, and the tightening of recycled-content requirements, and future higher rate per tonne, comes at a time when recycled polymers remain more expensive than virgin material, and domestic recycling capacity continues to contract. The budget’s shift towards a higher recycled-content threshold has intensified concerns around rising overheads and the widening gap between policy ambition and on-the-ground infrastructure where reprocessing capacity in the UK is considered weak.
The Print and Packaging industry believes that they may benefit from the £1.5bn skills package. This sees apprenticeships, digital training, employer incentives, and AI-focused programmes brought together under a single, more targeted framework. However, it is felt by some businesses that rising wage costs could accelerate automation, which may benefit those investing in advanced print/packaging tech or more efficient machines.
Missing from the budget was the anticipated plan to reform landfill tax by scrapping its lower rate, as the government seemingly listened to concerns raised by the construction and waste management sectors. This has significant implications for the packaging waste stream, but it will benefit businesses looking to build new facilities in the UK.
Overall, the budget may be seen as a growing divide: those firms able to adapt via automation, scale, or vertically integrated operations may survive, but many smaller or less flexible printers and packaging businesses may struggle.
Comments from the Print & Packaging Industry
Thomas Glendinning, Managing Director at Sovereign Labelling Machines, supplier of labelling and sleeving solutions:
“More needs to be done to address the skills gap that is evident in printing, packaging, and manufacturing more generally. I would like to see more pronounced measures that support British manufacturing. These are both obvious things that haven’t been happening. On the other hand, with the further rise of the national minimum wage, I’m hoping we can capitalise on this by helping our clients/potential clients to introduce more automation and ward off a hike in wage bills.”
Robbie Staniforth, Innovation and Policy Director at Ecosurety, packaging compliance expert:
“Sadly, there wasn’t enough in today’s budget to support the recycling and reuse of packaging in the UK. EPR alone will not drive the systems change required. We need more fiscal instruments from the Government over the next decade if we are to support the brilliant reprocessors and reuse systems of this country. The fact the Government still thinks in terms of a Consumer Price Index indicates just how far we have to go on the transition to a circular economy. Consumption is an outdated term from a linear world created by marketeers to sell more products. We are citizens of the planet that simply use resources, and hopefully return them to nature. When will we see a budget that encourages us to ‘consume’ less? The wait continues.”
Luke Wilson, Owner & Managing Director of FACER, Leeds-based print and packaging company:
“I read today’s UK Budget with a pinch of cautious optimism and a fist full of realism. On the positive side, the announced support for business investment – including expanded capital-allowances and tax incentives aimed at SMEs – could encourage manufacturers to modernise equipment – vital for any UK SME packaging manufacturer.
“However, significant challenges remain – to an extent, many of which reside outside the influence of the government’s budget – however, some of which are not helped by it, such as rising labour costs stemming from increases in the minimum wage and in turn, the Real Living Wage, in order to combat the real issue, the rise in the cost of living. Along with continued pressure on employer contributions, which will only put further squeeze on long-term business viability, especially at a time when other operating costs remain incredibly high and incredibly uncertain such as energy.
“Ultimately, the Budget delivers a mix of support and fresh burden – not a game-changer and not surprising, a manageable backdrop that offers all manufacturers the same deck of cards to play with. For FACER, it reinforces the need to invest thoughtfully, tighten cost-control, continue to improve efficiency and remain incredibly agile in response.”
Chris Jordan, Partner Founder at Exedrabridge, a print and packaging industry consultant:
“There was nothing I saw as particularly damaging to print, packaging, and design in the budget. The opportunities and challenges are two sides of the same coin. Those who are happy with change, can pivot, anticipate, and play what’s in front of them, and those who know how to sell and market themselves will reap the benefits. The huge majority, however, cannot, and so decline will continue. Add to this that the UK’s competitiveness and productivity are appalling, and the result is almost inevitable.”
Caroline Wiggins, Chief Executive at eGreen, sustainable tableware manufacturer:
“Tax and more tax! That isn’t good for consumers or business. Everything from pensions to milkshakes have been taxed, adding to existing measures like the plastic packaging tax, EUDR, waste packaging levy – the list goes on.
“Not only do we have to pay all these taxes, we also have to carry out all the extra admin behind the scenes. That comes with its own costs. And as most food is packaged in one way or another, covering these costs will ultimately lead to an increase in consumer prices.
“In our sector, restaurants and pubs are finding it particularly tough. The British Beer and Pub Association says that one pub is closing every day, so the outlook was already challenging. Unfortunately, the budget didn’t deliver any good news for most people. I think the implications of it are more serious than people realise.”
Roger Wright, Waste Strategy & Packaging Manager at Biffa, recycling and waste management company:
“From the wider Biffa group point of view, the government’s decision not to converge the two rates of landfill tax before 2030 is a positive outcome for our industry. Ministers have listened to stakeholders and avoided changes that could have increased waste crime and tax evasion. Retaining the exemption for backfilling quarries will also help housebuilders deliver much-needed homes without additional costs.
“On packaging specifically, we welcome upcoming consultations on the Packaging Waste Recycling Note system and on mandatory certification for mechanically recycled plastic under future Plastic Packaging Tax reforms. These are essential steps to address fraud, strengthen market transparency, and pave the way for further improvements, including a ban on exports of unprocessed plastic waste.
“However, increasing the Plastic Packaging Tax in line with CPI inflation for 2026 to 2027 does not go far enough. We have long advocated for a progressive structure that makes virgin plastic more expensive than recycled material, and inflationary uplifts alone will not deliver that shift.
“A commitment to consult on key issues is encouraging, but future reforms must incentivise investment in recycling infrastructure and support the UK’s transition to a low-carbon, resource-efficient economy. Our latest Economic Impact Report highlights what is possible, for example, banning the export of unprocessed plastic waste could create more than 9,000 jobs and generate £900 million in annual economic output, without relying on public funding.”
