How PPT Is Reshaping Packaging Cost

Plastic packaging tax obligations are reshaping the cost of cups and containers across the UK market, even if hospitality operators have no PPT registration/reporting obligations.

Since April 2022, the UK Plastic Packaging Tax (PPT) has applied to manufacturers and importers that produce or import more than 10 tonnes of plastic packaging annually, and from April 2026 the rate is expected to rise to approximately £228.82 per tonne on plastic packaging with less than 30% recycled content by weight.

As an importer, CupsDirect pays PPT on qualifying virgin plastic packaging placed on the UK market. However, PPT still influences the prices you see on menus and in purchasing budgets because it pushes up the cost of virgin plastic, while growing demand for recycled plastics like rPET is also driving those prices higher.

When did plastic tax increase in the UK?

From 1 April 2025 the PPT rate increased to £223.69 per tonne, and is expected to rise to approximately £228.82 per tonne in April 2026. For hospitality operators, that uptick means higher prices from packaging importers.

This guide explains how PPT works, how it affects virgin plastic and rPET pricing, and how to make informed, honest decisions about your packaging mix rather than chasing unrealistic “tax‑free” promises.

It’s part of our regulatory series on packaging compliance, and other posts dive into greenwashing risks, UKCA markings and sustainable material comparisons.

What is the UK Plastic Packaging Tax?

The Plastic Packaging Tax is designed to encourage the use of recycled plastic in packaging placed on the UK market. If you manufacture or import plastic packaging in the UK, you need to register when you exceed 10 tonnes of finished components in a 12‑month period.

Exempt packaging:

• Licensed medicines: Immediate packaging for authorised medicines is excluded from PPT.

• Transport packaging: Packaging used solely to import goods into the UK is not subject to the tax.

• Exports: Plastic packaging that is exported (except for transport packaging) can qualify for relief.

• Multi‑material items: If plastic is not the heaviest component by weight, the item may not count as plastic packaging.

• Small producers: Businesses manufacturing or importing less than 10 tonnes of plastic packaging per year do not have to register.

Who actually pays PPT?

• PPT is charged to manufacturers and importers that exceed the 10‑tonne registration threshold for plastic packaging components.
  

• CupsDirect, as an importer, is responsible for registering (where applicable), calculating and paying PPT on qualifying plastic packaging we bring into the UK.
  

• Hospitality operators purchasing from CupsDirect do not have PPT registration or reporting duties in relation to those packs, but they do experience the knock‑on impact of PPT in the form of higher packaging prices.

Which plastic packaging is taxed and which isn’t?

PPT applies on a component basis. If a container and its lid are separate items, each component must contain at least 30% recycled plastic by weight to qualify for exemption. The tax applies to components made entirely from plastic or to multi‑material items where plastic is the heaviest component.

Common misunderstandings to avoid:

• “Compostable” doesn’t equal tax‑free. Compostable plastics such as PLA are still plastics in PPT terms, so they are taxable unless they contain at least 30% recycled plastic.
  

• “Biodegradable” is not a recognised tax category. “Biodegradable” is a vague, unregulated marketing term and is not recognised in PPT rules; what matters is recycled plastic content and whether the material is plastic or non‑plastic. To pressure‑test your wording, work through our greenwash checklist for packaging and menus.
  

• Component weighting matters. A bottle with 30% recycled content and a pump with 0% recycled content will be taxed on the pump component only.

What is rPET and why demand is rising

What is rPET?

rPET (recycled polyethylene terephthalate) is PET plastic that has been collected, typically from post‑consumer bottles and packaging, then cleaned and reprocessed into a new polymer. It is widely used for cold drinks cups, salad bowls and portion pots because it offers similar clarity and strength to virgin PET.

Industry research from The APR shows that using recycled PET reduces energy consumption by about 79 % and greenhouse gas emissions by around 67 % compared with virgin PET. 

For a broader look at how rPET compares with paper and bagasse on end‑of‑life and UK infrastructure, see our sustainable materials comparison for food packaging.

Why rPET prices are rising

Growing corporate sustainability commitments and regulatory pressure have increased demand for rPET across Europe, which in turn puts upward pressure on rPET prices.

From April 2026, PPT is expected to add approximately £228.82 per tonne to qualifying virgin plastic packaging with less than 30% recycled content, and that cost is borne by importers and manufacturers such as CupsDirect. At the same time, strong demand for high‑quality rPET is pushing rPET prices up, so moving from virgin plastic to rPET does not guarantee overall packaging cost savings.

Browse our recycled cups to compare sizes and recycled content percentages for your menu, and talk to our team about how PPT and rPET pricing are affecting your category.

The UK Plastic Packaging Tax is a clear signal: the more virgin plastic you use, the more you’ll pay.

As the rate is expected to rise to approximately £228.82 per tonne in April 2026, switching to packaging with ≥30% recycled content or to non‑plastic materials can help manage exposure to future PPT changes, but does not automatically reduce overall packaging spend.

Looking for packaging that balances compliance, performance and long‑term cost control? Explore our rPET cups containers, and talk to our team about how PPT and material markets are shaping 2026 pricing.