Celebrating its 40th year in 2022, UK-based Tyler Packaging provides flexible packaging to a range of market. These include food, pet food, health and leisure, sports nutrition, building and chemical, and lawn and garden. Tyler offers a comprehensive range of films, premade bags, pouches, and sacks that encompass the most up-to-date production and materials technology.
In today’s environment that means sustainable packaging, which for Tyler is innovative, sustainably optimized flexible packaging. It’s a commitment the company has made since the beginning.
“We have continuously worked to advance sustainable packaging solutions, though never has this been more important than in the last decade,” says Adam Kay, sales director. “Sustainable solutions have grown significantly and the conversation around recyclable and compostable packaging has grown dramatically. Companies are now truly focused on their impact on the environment.”
Over the past two to three years those materials comprise recyclable monolayer plastic packaging and compostable packaging sold to customers globally, according to Kay.
Even an ocean apart, Kay feels that UK and US markets and trends are much alike.
“The focus in the UK is sustainability, as flexible packaging doesn’t require as much energy consumption as many other packaging solutions,” he notes. “The UK and US markets are very similar, with consumer convenience driving the market forward.”
Those similarities are also essentially true for the regulatory landscape for packaging, according to Kay.
But there is an exception, and it’s a notable one: the Plastic Packaging Tax (PPT) that goes into effect in the UK on April 1.
Compared to the US where just 9% of plastics are recycled, the UK boasts a robust 43.8% plastic packaging waste recycling rate. However, the flip-side reality of that is the 56% that’s wasted, which led to the creation of the PPT.
The challenge of The Plastic Packaging Tax.
As explained at the Pinsent Masons website, the PPT is "a new tax on plastic packaging manufactured in, or imported into the UK, that does not contain at least 30% recycled plastic is being introduced from 1 April 2022. The rate of tax will be £200 per metric tonne of plastic packaging. [Ed Note: That’s the equivalent of $262 for each 1.1 US ton.]
"The PPT is an environmental tax designed to provide a financial incentive for businesses to use recycled plastic in the manufacture of plastic packaging. The government envisages this will create greater demand for recycled plastic, stimulating increased levels of recycling of plastic waste and diverting it away from landfill or incineration."
Tyler points out that during the first year of the tax, a business will only need to register for PPT when their amount of plastic packaging exceeds 10 tonnes/11 tons in a 12-month period starting April 1. There’s also the complication of mixed material packaging, and as Tyler notes “if the packaging contains more plastic by weight than any other substance, it will be subject to tax.”
While it’s a burdensome complexity on many packaging businesses, Adams believes the PPT is a step in the right direction even though it presents several serious and immediate problems.
“It has the potential to make a real difference,” he says. “However, there are definitely a few issues that need to first be addressed before it can stand a chance of contributing towards a circular economy.
“Currently, the approach of the PPT is raising questions whether the UK can actually handle the significant growth of plastic waste it’ll need to process to meet recycled content demand. The availability of recycled plastic is low, so our infrastructure is not at all ready. Research shows that we will have to double our output of recycled plastic to meet governmental targets.”
Adams also feels the PPT will prove impractical.
"We feel that the PPT should not be based simply upon whether an item contains recycled plastic or not. With the current lack of infrastructure in mind, the expensive costs, and the fact that regulations and safety laws around medical, food and drink packaging mean using recycled plastic is incredibly difficult, if not impossible, the tax is unfair.”
Because demand outstrips supply, recycled plastics are expensive.
“They are so expensive, in fact, that it may actually work out cheaper for a packaging user to simply pay the tax instead and continue using forms of plastic packaging that aren’t environmentally friendly,” Kay says.
That will affect brands and therefore consumers.
“We feel that it’s going to result in retailers adding extra costs down the line for consumers to cover the charges incurred, with no increase in the use of recycled plastic,” Kay explains. “The tax should ensure that resource efficiency is incorporated alongside the amount of recycled material used and the recyclability of the product.”
It can happen here, too.
Can such a tax be enacted in the US? “I have no doubt that the UK Plastic Packaging Tax will drive change in some way to brands globally — the potential for a US version of the tax is there," responds Kay. "It will force many companies to focus on the impact they are having on the environment due to the amount of plastic they use in products. The tax will also automatically drive weight reduction to reduce the tax liability. We'll see companies moving from rigid to flexible packaging to achieve this. However, the main driver will be the challenges that will come with trying to achieve 30% recycled content within the packaging to avoid the tax — especially for food packaging.”
Like others faced with the same challenge, the packaging supplier continues to look for growth opportunities that center on two tried-and-true avenues to growth.
One of those is through strengthening its presence on this side of the Atlantic.
“We serve the US market and expect continued growth in the US in the coming years,” Kay says.
The second avenue is to develop new products. “We are constantly investing in research and development to ensure that we continue to develop the market,” says Kay, “whether that’s in new materials or material efficiencies to reduce our impact on the environment.”
As it has done for 40 years, Tyler Packaging will adjust to changes in the packaging landscape this year and beyond.