Plastic Packaging Tax: Budget 2025

Changes to the Plastic Packaging Tax (PPT) were announced in the Budget on 26 November 2025.

HMRC have communicated the changes which are shown below:

1. Rate Change April 2026

At Budget 2025, the government announced that the rate of PPT will increase in line with the Consumer Price Index (CPI). The rate will increase from £223.69 per tonne to £228.82 per tonne from 1 April 2026 and will apply to plastic packaging containing less than 30% recycled plastic that is manufactured in and imported into the UK. This change will be legislated for in Finance Bill 2025-26.

The rate will be updated on GOV.UK in due course here: Plastic Packaging Tax: steps to take - GOV.UK.

2. Mass Balance Approach (MBA) and Removal of Pre-Consumer Plastic

As previously announced, the government confirmed at Budget 2025 that it would allow businesses to use a MBA to attribute chemically recycled plastic for the purposes of PPT with effect from April 2027. From the same date, pre-consumer waste will no longer be accepted as a source of recycled plastic for the purposes of PPT. Provision for these changes will be legislated for in Finance Bill 2025-26.

MBA - What Happens Next

We are developing the detailed requirements of MBA in collaboration with the Industry Technical Working. The details will be set out in Regulations and published for technical consultation during 2026. We will provide further updates via the PPT MBA mailing list.

3. Mechanical Recycling and Mandatory Certification

As announced at Budget 2025, the government will be launching a consultation in early 2026 to seek views on the potential introduction of mandatory certification for businesses claiming relief from PPT on the basis that their plastic packaging contains at least 30% mechanically recycled plastic, following compliance concerns raised by businesses.

This consultation will explore the risks and issues with the verification of mechanically recycled plastic and invite views on the whether to introduce mandatory certification and the potential impacts on businesses.