Taxing the plastics industry is likely to accelerate the way to a recession in Europe, warns trade association European Plastics Converters (EuPC), in response to European Commission (EC) proposals for the introduction of a national contribution across the EU based on unrecycled plastics packaging for the period 2021-2027.
EuPC claims that without consultation with the main industry stakeholders, this proposal will lead to rather opposite economic and environmental results, negatively affecting the entire plastics industry across the EU, which is composed of more than 50,000 SMEs and employs more than 1.6 million people.
According to the proposal, the contribution can be paid by EU Member States into the common budget but each of them will be free to decide how and where to collect the due amount. This, says EuPC, will create fragmentation in Europe that will likely disrupt the single market, with some countries potentially taxing production or consumption of plastics packaging, without working on the key issues.
“Such a contribution will not be exclusively linked to any expenditures or investment in existing national plastics waste management systems,” said EuPC, adding that it will discriminate plastics and disrupt free market choices.
EuPC’s managing director Alexandre Dangis, said: “The EU Commission is making a huge mistake. In five years from now, we would be able to assess the damages of such short-sighted populistic measures. Especially SMEs, the backbone of the European economy would be heavily affected and it would mean the end of the EU single market.
“The financial hole of €7 billion ($6.2bn) left by Brexit cannot be paid by the plastics packaging industry alone to secure the funding of the overall EU budget. A restructuring of the EU expenses or an increase of the contributions to the EU budget via the GDP performances of the countries would be a much better alternative.
“In the following years, the EU institutions are forcing our companies in Europe to pay EPR fees and taxes and to invest in circularity, without concerns about the imports. It is very sad and discomforting to see that the tools available to EU policymakers are not used efficiently and that these additional taxes will accelerate the way to a recession in Europe. A good start in 2020 for the new Commission.”