What is the ‘Plastic Bag Tax’?
Carrier bags are among the most important elements of modern age culture. It’s a surprise Darwinists aren’t predicting the evolution of man to have carrier bags instead of fingers, made necessary by humanity’s insatiable need to shop. The plastic bag (the original carrier bag) is well known for its ruggedness, simplicity and usefulness. Prior to the 2010s, carrier bags were considered an absolute need for retail, given away for free by retailers to facilitate shopping needs of customers. Ultimately, it was cheaper for retailers to provide free bags to encourage shoppers to buy more without consequence than it was to charge for bags and potentially deter larger purchases. The plastic bag charge is essentially a mandatory 10p tax consumers must pay to purchase plastic bags, and with its introduction in 2015 (at 5p per bag), this all changed.
The plastic bag charge of course was not implemented to disincentivise larger purchases, its intention was to disincentivise the amount of single-use plastic bags being used. It sought to introduce a layer of consideration for shoppers when deciding to purchase a plastic carrier bag, and it also incentivised businesses to switch to plastic alternatives which didn’t require a charge. The thought behind this was that businesses would switch to bags with no charge, and customers would favour these alternatives as a result. What’s been observed, 10 years on, is that retailers have often opted to introduce a charge on all carrier bags, levelling the playing field for both plastic and non-plastic bags, making it the consumer’s choice which bag they use.
What was the effect of the ‘Plastic Bag Tax’?
The introduction of the plastic carrier bag charge in 2015 was mostly well received. 62% of people in England agreed that the charge was ‘reasonable’, but many conservationists & experts believe this did not go far enough. According to Government data, the total number of single-use carrier bags sold in the UK between 2016 and 2017 was 2.12 billion. By 2020-21, this had come down to just 488 million.
The aim of the plastic carrier bag charge was to reduce the purchase and usage of single-use carrier bags, and though consumption remains high (the equivalent to 3 plastic bags purchased per person in the UK), it has achieved its goal of significantly reducing the number of plastic bags sold. The charge encouraged customers to give a second thought to their carrier bag purchases, favour reusable bags, and if they had to purchase a single-use bag, incur a cost that is ‘expected’ (not mandated) to be donated to ‘a good cause, particularly an environmental cause’.
What are the problems with the ‘Plastic Bag Tax’?
Though it has had a significant impact on sales of plastic bags, reducing them by over 75% between 2016 and 2021, the plastic bag charge has not removed the need for single-use plastic bags. After years of seeing the impact of this change, we’re beginning to see a stabilisation of the numbers of plastic carrier bags sold at just under 500 million per year, which equates to around 3 bags for every person in the UK. We cannot understate the impact of the ~75% reduction in plastic bags sold in a 5–6-year period, as this is a massive change for the better. However, the reality is that the charge appears to have reached its peak effectiveness, with still a significant number of plastic bags being sold.
Unfortunately, the charge does not act as enough of a disincentive to have a more measurable impact on sales, both to retailers and consumers. The 10p charge, though appearing to be double the previous 5p charge, equates to only a 48% increase in the cost of the carrier bags when adjusted for inflation. This paired with consumers’ familiarity with the charge causing a lower ‘shock’ impact than in 2015, the 2021 increase has had less of an effect on sales.
Retailers too have less reasons to care about helping achieve the goals surrounding the agenda of the charge. There are many variables that negate the requirement for the charge, one that’s particularly interesting is the exemption of woven plastic bags from the charge – likely due to their increased desirability for reuse. Though their eco-friendly footprint is better than standard polythene bags, it begs the question: why are we drawing the line so close when there are many more eco-friendly reusable alternatives than woven polypropylene bags?
It’s also worth noting the flexibility offered to retailers with regards to the charge. Retailers have full autonomy over how they apply charges to their bags, and what they do with the revenue generated from bags affected by the charge. Retailers have the option to continue to provide free bags outside of those affected by the charge, such as paper bags, however this very rarely occurs. Most retailers will charge across the board for their carrier bags, meaning customers have no disincentive for choosing plastic carrier bags if deemed the best-value option, negating the charge entirely.
For businesses with over 250 employees, data must be reported on the number of single-use bags sold. Despite the requirement for transparency, fewer retailers are reporting data on the number of bags sold, including fewer retailers voluntarily reporting this data. Retailers are encouraged to donate their single-use bag turnover to good causes, however between 2021 and 2022, only 65 retailers (42% of the retailers responsible for over 90% of single-use bags sold) reported this data to Defra. This is down from 61% (or 153 total) between 2017 & 2018. There is no incentive for retailers to follow the UK Government’s recommendations around donating this money to good causes, and as these donations are at the retailers’ discretion, the impact of these donations are not measurable.
Perhaps the most obvious problem with the plastic carrier bag charge is the goal it is trying to achieve. The charge provides a disincentive to use plastic bags but does nothing to incentivise a solution to the wider issue of environmentally unfriendly bags. We’ve created an article surrounding this topic, but the most important takeaway is that all plastic bag alternatives have their downsides. Even the most eco-friendly bags’ green credentials are completely useless if not disposed of correctly. Yes, the plastic bag charge has an impact on the number of single-use bags sold, but that’s just one part of the problem. Without incentives for people (and retailers) to make the move to more eco-friendly bag options, the default will always be to the cheapest, strongest, easiest-to-store and easiest-to-dispose-of option, plastic.
How did the ‘Plastic Bag Tax’ change in 2021?
Between 2015 and 2021, the plastic carrier bag charge was 5p per plastic bag sold (subject to its specification). In 2021, the plastic bag charge was changed from 5p per bag, to 10p per bag.
Since the charge was introduced, there has been a wide variety of variables that determine whether the charge applies, such as the thickness of the plastic, the function of the bag, replacement ‘bags for life’ and so-on. A primary factor influencing whether the charge was applied was the size of the business providing the bag. When introduced in 2015, the charge only applied to businesses with more than 250 employees. In 2021, the charge was updated to apply to all businesses, no matter their size. Despite this, there remains a difference in the burden of the charge between large businesses and small businesses. Retailers below 250 employees do not need to report their bag sales figures, or where the money generated from carrier bag sales goes, but retailers with 250 or more employees need to provide this data to the UK government.
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