UK businesses have paid more than £3.5 million ($4.5m) since 2011 for breaching the Packaging Regulations, claims Kite Environmental Solutions, which operates one of the country’s Packaging Compliance Schemes.
Introduced in 1997 to reduce the amount of packaging waste heading to landfill, the Packaging Regulations demand that any UK company with a turnover of more than £2m ($2.6m) needs to assess how much packaging that they have placed onto the UK market as a result of their business activities. If this packaging exceeds 50 tonnes a year then companies pay a levy (green tax), which is used to find recycling of packaging waste.
The tax levied on business is calculated depending on the weight of packaging, by material type that a company ‘places’ onto the UK market during a calendar year. The amount of tax due also depends on the activities performed on the packaging. Companies can be a manufacturer of packaging; a converter of packaging; a packer/filler of packaging and a seller of packaging around goods. Each separate activity attracts a percentage of the overall tax; although this is further complicated if a company imports raw materials, components or finished goods into the UK.
Kite says that many companies it approaches are unaware of the Packaging Regulations and that they might be affected. In order to prevent problems arising from previous years’ sanctions, Kite has proposed a remedy under the Civil Sanction rules, which were introduced by the Environment Agency in 2011.
Said a spokesman for Kite: “These rules enable companies to do an ‘Enforcement Undertaking Offer’ to wipe the slate clean for any years of missed registration. Prior to this the only enforcement tool that the Environment Agency could use was to prosecute companies through the courts.
“Enforcement Undertakings are designed to level the playing field, by enabling companies to own-up to having missed registration in previous years and to settle outside of the courts. The process involves assessing the registration and levy costs a company avoided by not registering each year and then offering to pay 110 per cent of these costs to an Environmental Charity.”
“Where the Environment Agency approaches a business about previous year’s non-compliance then companies may be asked to submit a ‘reactive’ Enforcement Undertaking offer. In these circumstances the offer must be 130 per cent of the avoided costs. Since 2011 the majority of the offers have been reactive (64 per cent) implying the Environment Agency found the company not to be compliant. 100 per cent of Kite’s Enforcement Undertakings have been ‘proactive’, reducing the costs to its Members via the lower cost, 110 per cent route.”
Therefore, Kite is urging all affected companies to get registered as quickly as possible and start being compliant.
To read more about the Packaging Regulations: http://packagingregs.co.uk/contact.htm