Key consultation on mandatory third-party certification for UK Plastic Packaging Tax recycled content claims

Until 10 August 2026, HM Revenue and Customs is consulting on mandatory third‑party certification to evidence mechanically recycled plastic content where businesses claim the UK Plastic Packaging Tax (“PPT”) exemption for recycled content. The stated aim is to reduce the risk of fraudulent or erroneous claims, standardise evidential requirements, strengthen compliance activity, and align with wider PPT reforms. Waste management companies, plastics suppliers and those relying on the exemption should consider their position under the proposals.  

Context

PPT was introduced on 1 April 2022 to incentivise the use of recycled plastic in packaging manufactured in or imported into the UK, as part of the UK's circular economy agenda. Businesses that manufacture or import 10+ tonnes of finished plastic packaging components in a 12‑month period must register. PPT applies where packaging contains less than 30% recycled plastic, at a current rate of £228.82 per tonne. From 1 April 2027, pre-consumer plastic waste will no longer count towards meeting the 30% recycled content threshold for the PPT exemption.

Evidence is central to the regime. PPT is payable unless a business holds sufficient evidence that the 30% recycled content threshold is met. There is no test available to verify recycled plastic content, so verification relies on chain‑of‑custody evidence. HMRC “force of law” guidance stipulates evidentiary requirements but does not prescribe the exact documents a business must hold – this provides flexibility but also creates uncertainty around acceptable evidence. 

For chemically recycled plastic, certification requirements are already due to be introduced from 1 April 2027, alongside the adoption of a mass balance approach (MBA) to calculate recycled content in packaging composed at least partly of chemically recycled plastic, under which the recycled content is evidenced through certified chain-of-custody systems. This consultation seeks views on the potential for introducing a similar certification requirement for mechanically recycled plastic, which is the dominant recycling method in the UK and globally. 

Why consult now?

Industry stakeholders have raised concerns about the robustness and consistency of evidence used to support recycled content claims, particularly for imported packaging and complex global supply chains. HMRC currently holds “very little evidence” of widespread fraud but highlights that recycled content exemptions account for a significant share of non‑taxable PPT tonnage and that the evidence base is challenging to verify at scale, particularly where documentation is varied in format/quality.

The government is seeking to understand whether there is a material problem (fraud/error) requiring intervention, and, if so, whether mandatory certification would be a proportionate response. 

Consultation details

The principal areas are: 

1. Current practice and prevalence of fraud: feedback sought includes what types of recycled plastic businesses rely on to meet the 30% threshold (mechanical/chemical/mix); what documentation is used to evidence the threshold, and difficulties in obtaining and verifying it; and insight into prevalence of fraud or error and whether it relates predominantly to UK-manufactured or imported packaging. 
2. Whether mandatory certification would be proportionate and effective: if certification would provide greater certainty for businesses by clarifying and standardising evidential requirements, reducing risk of fraud or erroneous claims, and aligning with the approach for chemically recycled plastic.
3. How certification would operate: mandatory certification would operate via independent third-party certification schemes meeting minimum requirements set out in future legislation. The government would not prescribe a single certification scheme; businesses would have flexibility to choose a scheme that meets the minimum standards. Key features under consideration include recognition of credible existing schemes, independent audits conducted by accredited certification bodies, and certification focused on chain-of-custody and traceability of recycled plastic.
4. Timing: the government acknowledges the need for adequate lead-in time, interaction with the wider PPT changes taking effect from 1 April 2027, the importance of aligning implementation with accounting periods. Views are sought on industry readiness.
5. Business impact: The information sought in the consultation will be used to estimate the impact of the measures proposed. Certification would affect the whole supply chain, and in practice, all businesses from the recycler up to and including the manufacturer of the finished plastic packaging component would need to be certified; importers would need to obtain valid certificates from their suppliers. The consultation questions whether the requirements should apply to all businesses claiming PPT exemption, how it would affect pricing and whether costs would be absorbed or passed on to consumers

Potential business implications 

Although the final design and timing are not settled, businesses should note the following potential impacts: 

• Compliance costs and additional operational burden across the supply chain: certification would involve obtaining and maintaining certification, paying fees, conducting internal audits and cooperating with independent audits – these costs could be particularly significant for SMEs. 
• Supply chain restructuring: procurement teams in businesses depending on certification ‘up the chain’ to claim the exemption will need to consider embedding certification/traceability obligations into supplier terms, negotiating access to audit outcomes/certification status, and international supplier selection.
• Pricing impacts: For those paying PPT because they lack sufficient evidence, certification could unlock the exemption. Alternatively, certification costs may be passed through to customers.
• Levelling the playing field: Certification could address concerns that some importers benefit from weaker or unverifiable claims, undercutting compliant domestic recyclers.

Next steps 

Responses will inform the government's decision on whether to proceed with mandatory certification and may be submitted via the online form or by email to teamindirecttaxdesign@hmrc.gov.uk.

Parties wishing to be included in a consultative meeting are asked to contact HMRC by Friday 5 June 2026.