{"id":10652,"date":"2025-12-05T01:30:11","date_gmt":"2025-12-05T06:30:11","guid":{"rendered":"https:\/\/www.packagingindustrynews.com\/?p=10652"},"modified":"2025-12-05T01:30:11","modified_gmt":"2025-12-05T06:30:11","slug":"chemical-recycling-becomes-tax-eligible-for-uk-packaging-from-2027","status":"publish","type":"post","link":"https:\/\/www.packagingindustrynews.com\/?p=10652","title":{"rendered":"Chemical recycling becomes tax-eligible for UK packaging from 2027"},"content":{"rendered":"


\n<\/p>\n

\n
\n
\n \n <\/picture>
The policy marks a key turning point, pushing manufacturers and importers to rethink feedstock, improve traceability and prepare for stricter reporting requirements. \/ Credit: FOTOGRIN via Shutterstock<\/figcaption><\/figure>\n<\/p><\/div>\n

The UK government has confirmed that companies using chemically recycled plastic for packaging will be able to count this material towards the recycled-content threshold under the Plastic Packaging Tax (PPT) from 1 April 2027.<\/p>\n

At the same time, plastic produced from pre-consumer waste (such as production off-cuts) will no longer qualify as \u201crecycled content\u201d under the tax.<\/p>\n

\n
\n
\"\"\/<\/figure>\n

Discover B2B Marketing That Performs <\/h4>\n

\n\t\t\t\t\t\tCombine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.\n\t\t\t\t\t<\/p>\n


\n\t\t\t\t\t\t\tFind out more <\/svg><\/span><\/a><\/p>\n<\/section>\n<\/div>\n

How the mass balance approach works for chemical recycling<\/h2>\n

Under the new rules, chemically recycled plastic \u2014 once processed and certified \u2014 can be allocated against finished packaging through a Mass balance approach (MBA).<\/p>\n

This methodology tracks recycled input (the plastic waste or feedstock) through to final output (the plastic packaging product), even when blended with virgin plastic.<\/p>\n

The change addresses previous challenges: until now, businesses using chemically recycled plastic struggled to prove the recycled content in a way accepted by PPT rules.<\/p>\n

The new approach aims to offer a transparent, auditable route for allocating recycled content.<\/p>\n

To qualify, manufacturers and importers will need certification under a scheme compliant with PPT-MBA standards, and maintain traceable records from waste through to finished packaging.<\/p>\n

Pre-consumer waste excluded: what changes<\/h2>\n

From April 2027 the UK will remove pre-consumer waste \u2014 such as production scrap, off-cuts or regrind from manufacturing \u2014 from the definition of recycled plastic eligible for PPT exemptions.<\/p>\n

That means using scrap plastic alone will no longer help manufacturers meet the 30% recycled-content threshold required to avoid PPT.<\/p>\n

This move is designed to close a long-standing \u201cloophole\u201d and strengthen the environmental integrity of the tax.<\/p>\n

According to government guidance, the change will level the playing field between firms and ensure that recycled content reflects genuine post-consumer or chemically recycled material \u2014 not simply internal production waste being reused.<\/p>\n

What it means for the packaging industry<\/h2>\n

For packaging manufacturers and importers, the 2027 changes could prompt a shift in sourcing strategy.<\/p>\n

Companies that have invested heavily in using pre-consumer scrap to meet recycled content targets may face increased tax liability unless they switch to recycled feedstock verified under the mass balance scheme.<\/p>\n

The changes may also stimulate demand for chemically recycled plastic and boost investment in chemical recycling infrastructure, particularly for materials that are difficult or expensive to recycle mechanically (e.g., certain film grades or mixed-polymer packaging).<\/p>\n

At the same time, businesses will need to prepare: they must ensure supply-chain traceability, secure certification, and update reporting systems to benefit from the new rules. Failure to adapt could result in higher tax bills or compliance risk under PPT.<\/p>\n

The UK\u2019s decision to accept chemically recycled plastic under a mass balance approach marks a significant development for sustainable packaging.<\/p>\n

As the 2027 effective date approaches, packaging firms and material suppliers will need to assess their strategies \u2014 balancing cost, compliance and environmental credentials before the new rules apply.<\/p>\n

<\/p>\n

<\/p>\n

\n