Dear AHEC Members,
Following the introduction of a new tax on single-use plastic packaging from 1st January 2023, AHEC members exporting to Spain will be obliged to provide details of the quantity of plastic packaging used with all consignments shipped into the country. These details are required to be entered onto the customs form. The importer is obliged to pay a tax of €0.45 per kg of plastic packaging before placing products on the Spanish market – unless certain specific exemptions apply.
While the tax currently applies to imports into Spain, other EU Member States including Italy, Germany, Poland, and Sweden, have all announced their intention of introducing similar measures in the near future as part of their national obligations under the EU Green Deal.
Starting on 1 January this year, Spain began enforcement of the new tax (referred to as IEPNR) on “non-reusable plastic packaging”. The IEPNR, which was set out in Spain’s Law 7/2022 of 8 April 2022 on “waste and contaminated soils for a circular economy” had met with considerable resistance in Spain given the current economic climate. It’s enforcement from the start of this year, which had already been delayed, surprised many commercial interests both inside and outside Spain.
The tax applies throughout Spain, including Ceuta, Melilla, and the Canary Islands, and taxes both the import and manufacture of non-reusable plastic in the country.
The definition of “packaging” taxed under the Spanish law includes not only that used directly for selling products but also packaging required in transport. Items such as plastic straps around packs of lumber or shrink wrapped plastics to protect veneer and flooring are therefore subject to the tax.
The IEPNR applies the rate of €0.45 per kilogram of plastic in packaging.
Recycled plastics are not subject to the tax. However, to avoid paying the tax, the importer must demonstrate that plastics are certified by an ISO 17065 accredited Certification Body as containing only recycled material in accordance with UNE EN 15343:2008. This is the European standard for “plastics recycling traceability and assessment of conformity and recycled content”. At present, there is no clear information on how widely this standard is applied by plastic packaging suppliers, but AHEC understands that formal certification of recycled content is still not widespread, either in the EU or North America. In practice therefore, as things stand, most Spanish importers are likely to be obliged to pay the tax.
While Spanish manufacturers and traders operating in the EU single market have to self-assess and pay the tax in the same periods (monthly or quarterly) as their VAT self-assessment, Spanish importers are required to settle the tax through the Single Administrative Document (SAD) used for customs declarations.
The taxable amount of non-recycled plastic in kg (to two decimal places) is required to be entered into box 47 of the SAD. If exemptions apply, then the relevant code for the exemption should be declared in box 37.2 of the SAD. Specific exemptions that might apply in the case of U.S. hardwood consignments include:
Further details on customs formalities for importing goods subject to the tax are provided by the Spanish government at: https://sede.agenciatributaria.gob.es/Sede/en_gb/impuestos-especiales-medioambientales/impuesto-especial-sobre-envases-plastico-reutilizables/formalidades-aduaneras-impuesto.html
A sample calculation provided by an AHEC member of the plastic strap weight for a typical load of U.S. hardwood lumber shipped into the EU is also provided in the attached xlsx file.
The plastic tax levy introduced in Spain forms part of an EU-wide regulatory process to deliver on the European Green Deal (EGD). All EU Member States are now obligated to make a national contribution to the EU budget in support of the EGD equivalent to €0.80 per kilogram of plastic packaging waste that is not recycled within their territory. However the mechanisms by which Member States raise the money to pay this EU-wide levy are not harmonised. Each Member State designs its own regulation to capture the underlying taxes and contributions from market players and industries.
Spain has moved faster than other EU countries to implement specific legislation to implement a tax at national level to fund the EU levy. Some other EU Member States are expected soon to adopt a similar approach. In fact Italy planned to introduce a very similar tax – known as MACSI – from 1st January 2023, but a decision was taken in November last year to suspend application until further notice. Poland, Germany, and Sweden have already announced that they will implement new plastic-related legislation soon. Other EU countries may adopt a different approach, for example by imposing so-called “extended producer responsibility” (EPR) fees and obligations on manufacturing companies, or developing new deposit-return systems. Some EU countries may go so far as to completely ban single-use plastics.
Outside the EU, the UK Plastic Packaging Tax took effect on 1 April 2022. So far this has not impacted on the US hardwood trade. UK government guidance states that plastic packaging used to import goods into the UK is not chargeable for the tax. Furthermore the tax only applies if a business places more than 10 tons of plastic packaging onto the UK market in a 12 month period. The rate of the UK tax is also lower than that set in Spain (£0.20 per kg of plastic packaging).
Michael S Snow