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"EU plastic tax": UBA presents report examining economic instruments

The study on a suitable financing model for the levy on non-recycled plastic packaging waste does not come to a clear recommendation.


A total of around €1.3 billion (€0.80 per kilogram of material) is due annually in Germany for non-recycled plastic packaging waste on the basis of the levy known as the "EU plastic tax". The levy has so far been paid from the German federal budget. On behalf of the Federal Environment Agency (UBA), experts from the Öko-Institut, Institut Cyclos HTP, GVM - Gesellschaft für Verpackungsmarktforschung and RWI - Leibniz-Institut für Wirtschaftsforschung e.V. examined various economic financing instruments such as excise taxes, compensatory and special levies for their feasibility and potential ecological steering effect. The authors of the interim report see advantages and disadvantages for each of the three instruments examined.
Excise taxes could be levied independently of the material on all packaging subject to system participation, or limited to beverage packaging subject to system participation, or material-specifically on all plastic packaging. In any case, they would have to be transferred to consumers via retailers as part of the retail price, the report says. In principle, a high revenue effect could be achieved with all three variants, which would be positive for the goal of offsetting federal spending on the EU own resource. However, for the first variant - excise taxes on all packaging subject to system participation - the entire German tax system would have to be comprehensively restructured in order to compensate for the considerable impact on the tax burden of the population. This seems "politically unrealistic" to the authors of the report. It can be assumed, they say, that the tax would be so small that it would only be possible to trigger incentives for reduced packaging consumption among end consumers to a very limited extent. A beverage packaging tax, on the other hand, is likely to trigger significant incentive effects, in particular in the direction of reusable solutions and thus packaging avoidance, depending on the design of the tariff, also for material savings and possibly the use of recyclates. In view of the effect, there was more to be said for an excise duty on beverage packaging subject to system participation than for a general or material-related packaging tax. But then there would also have to be an effective financial steering instrument for the remaining very large quantities of packaging, according to the report. Particularly in the case of variant three of the consumption tax, which would only be related to plastic-containing packaging, there would also be a risk of unfavorable misdirection effects in favor of other environmentally problematic packaging materials.
If, on the other hand, a compensatory levy on non-recycled packaging waste were introduced as an instrument for European own resources, the operators of dual systems would have to pay this levy and pass on the costs to the distributors via allocations or surcharges on the participation fees, the report continues. This would give distributors an incentive to reduce plastic packaging and switch to non-plastic packaging or reusable packaging. The equalization levy would make recycling volume the parameter of performance competition between dual systems. "This could eliminate the major design flaw of the VerpackV and VerpackG, that there is almost only price competition and hardly any performance competition between the dual systems," the experts state.
Finally, as a last instrument, the report examines a special levy to promote the recyclability of packaging and the use of recyclates, which could also be structured as a fund. This instrument is not suitable for counter-financing the EU's own resources, they say. Possible fund solutions had also already been examined and discussed within the framework of the research project for the further development of § 21 VerpackG for the ecological design of the participation fees. Since the decision on the future design of Section 21 is still pending, the instrument of the special levy would possibly be "obsolete" if a fund solution for improving the recyclability of packaging subject to system participation were to be established in the Packaging Act.
Further information: to download the report "Untersuchung ökonomischer Instrumente auf Basis des EU-Eigenmittels für nicht recycelte Kunststoffverpackungsabfälle"

  • UBA Newsletter (Sept. 5, 2023)
  • (Sept. 9, 2023)
  • Picture: © UBA, excerpt from the report title

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