New ‘grocery tax’ draws criticism as consumers to foot an extra £56 a year
A new government net zero legislation, dubbed the “grocery tax”, is expected to increase household shopping bills by up to £1.4bn a year, as critics label it “unnecessary” and “growth destroying”.
Formally named the Extended Producer Responsibility, the new green levy is thought to cost shoppers up to £56 a year more on their household bills, according to calculations published the department for environment, food and rural affairs (Defra), revealed by The Telegraph.
The scheme will see retailers and manufacturers charged per tonne of packaging materials they use – with plastic wrapping taxed higher than paper or cardboard – in a bid to reduce the UK’s consumption of plastic and hit net zero targets.
The tax will cover the cost of collecting and disposing of packaging waste, which is currently being shouldered by local authorities through council tax. It has not yet been confirmed whether council tax will now be reduced accordingly.
Under the new scheme, it is understood that if consumers choose to buy the same products, and not switch to plastic-free alternatives, the new measures will cost individual households an additional £28 a year in a “low scenario”, £48 in a “central scenario” or up to a maximum £56 in a “high scenario”.
In a central scenario, Defra said 85% of the costs will be passed on to consumers, whereas a high scenario would see 100% of the new tax covered by shoppers.
Subscribe to Grocery Gazette for free
Sign up here to get the latest grocery and food news each morning
However concerns have been raised about the true cost of the initiative, with critics warning that the new measures may push up costs for families that are already facing rising food prices and an ongoing cost of living crisis.
The British Retail Consortium (BRC) said it believe the government’s forecast of an addition of £1.4bn in retail sales is an underestimation and the actual cost will be closer to £2bn.
Speaking to the Telegraph, Net Zero Scrutiny Committee chair Lord McKinlay accused the government of “quietly” pushing through the legislation, saying: “The rapidly introduced, yet little noticed ‘grocery tax’ legislation has quietly landed.”
McKinlay added: “It heaps more than a billion pounds of new and unnecessary costs on consumers, but as ever when government departments estimate implementation costs, these are often hopelessly underplayed.
“It needs to be called out for what it is: yet another net zero tax which adds to consumer cost inflation, and further adds to the administrative burden on UK businesses. Another growth-destroying measure by an inept Government.”
The new measures, which were first announced in 2018 by Michael Gove, follow calls from retailers and environment campaigners for the government to introduce blanket regulation to tackle the use of plastic packaging in supermarkets.
However earlier this year, Tesco and Sainsbury’s came under fire for “misleading” consumers after an investigation revealed soft plastic packaging from their in-store recycling scheme was being sent overseas and burned.
6 Comments. Leave new
This new tax has been put in to take the burden of disposal away from local councils. Will the councils reduce council tax accordingly or will the people of this country be expected to pay for the same service TWICE ?
This government will be taxing air next.
Yet another tax imposed by the government QUIETLY and this tax will go up every year . Disgraceful . We are all be clobbered by the government tax hykes apart from the illegal immigrants on boats entering our waters and the RNLI assisting the border force , to pick them up .
Yet another tax QUITELY being implemented , the public are certainly being clobbered on higher taxes on everything , apart from the illegal immigrants not having to pay anything and entering our waters and the RNLI assisting the border force to pick them up and welcoming them to the UK . Disgrace
What an absolute joke we all recycle our waste when I was a kid the bin men emptied your dustbin and left you bin liners .Why can’t the supermarkets give the customers the opportunity to pick fruit and vegetables lose instead of packaged half the contents are bruised and rotten.If you want to save the environment loose the hazardous materials and think green.The future with this government doesn’t look good more food banks more crime more tax no wonder people are moving out of the UK.English men /women and there castle freedom of speech pahahahaha
This guy will be out of no10 faster than sh*t through a baby