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Beginning 5-Oct-15, big shops/retailers in England began to charge five pence or 5p on every single plastic carrier bag the shopkeepers provided.

The United Kingdom government aims to protect its environment from pollution and is working towards creating a healthy environment for its citizens.

The government is focussed on reducing the use of plastic carrier bags, thereby, boosting UK citizens to reuse bags. With this scheme, the government estimated that the 5p charge on single use plastic carrier bags could reduce usage by as much as 80% in the big supermarkets.

Customers can skip paying the carrier bag charge either by using the single use plastic carrier bag again, or by carrying a multi-purpose carrier bag. Additionally, customers won’t be required to pay a 5p charge if:

  • The customer(s) bag contains products such as bulbs and flowers, prescription medicines, raw meat and fish, uncovered blades, unwrapped food, seeds, or live fish
  • They are using a paper bag
  • The customer(s) is in transit

Retailers, in the United Kingdom, are required to keep trajectory of number of plastic bags they have given to customer and where the count has gone.

They are also required to report the count of plastic bags to the Government before 31st May each year.

As mentioned about big shops/businesses, this is referring to retailers with employee strength of 250 or more.

Under the ‘A Green Future: 25 year environment improvement plan’, the United Kingdom government aims to spread the scheme to small retailers as well.

According to the 25 year environment plan, the accomplishment of the 5p plastic bag charge has helped to decrease the usage of carrier bags by 83%.

This reflects the alteration which government regulations can make, and validates that guarding the environment is mandatory and a task that each individual must take up seriously.

The government, firstly, is working towards making a voluntary arrangement with industries in the United Kingdom to attain this, before making it compulsory for small retailers

Work out if a Retail Store Qualifies as a big Shop/Retailer

Retailers in the United Kingdom need to work out the number of full-time equivalent or FTEs employed at the beginning of every reporting year.

Here, the reporting period is defined as the time period starting from 7 April every year to 6 April of the succeeding year.

The initial reporting period ran for a period of 6 months from 5-Oct-15 to 6- Apr-16.

For computation purpose – on the initial day of the recording year the retailer must compute the number of full-time equivalent or FTEs employed:

  • Compute the number of hours a FTE will work in a given year – Let’s assume, an employee works for 40 hours each week, therefore, for 52 weeks the total number of hours worked is equivalent to 2,080
  • Multiply the total number of hours worked in an annum by the total FTEs employed in a given year – Let’s assume, a retailer employees 200 FTEs, therefore, the total numbers of hours worked is equivalent to 200 x 2,080 = 416,000
  • Compute the seasonal workers and part-time employees the retailer has by multiplying the weeks worked by the employees’ weekly hours – for example, if 100 workers were employed for 10 weeks and they worked 20 hours, then, (100 workers x 20 hours x10 weeks = 20,000) + (100 workers x 40 hours x 25 weeks = 100,000). Hence, total hours = 120,000
  • Sum-up the total number of FTEs and seasonal workers or part-time workers’ hours = 416,000 + 120,000 = 536,000
  • Divide these total number of hours by the hours FTE would work during a year = 536,000/2,080 is 257.69
  • If the above computed number of FTEs is greater than or equal to 250, then the retailer should charge for the bag

How to avoid paying Carrier Bag Tax?

United Kingdom citizens can escape paying carrier bag tax if they opt to carry their own bag for shopping.

How to avoid paying carrier bag tax

In certain shops, customers can purchase heavier, environmentally friendly ‘bags for life’ and can keep using them again and again. These bags can even be replaced, free of cost, when they wear out

Bags for life and returnable bags

UK citizens are not required to pay 5p for:

  • Woven plastic bags
  • Bags that can be used for used again and again, and can even be replaced. A returnable reusable bags must be all of the following:
    • Sold for 5p or more
    • Appropriate for reuse
    • Can be replaced without can charge if returned when worn out

Food and Plants

Retailers are not required to charge for plastic bags that are for:

  • Corms, bulbs or rhizomes (stems and shoots, ginger, roots)
  • Flowers, and potatoes
  • Unprepared fish and fish products
  • Unwrapped loose seeds
  • Unprepared poultry, meat and their products
  • Unpacked food to be consumed by humans or animals – such as food in containers or chips

Products

Retailers are not obliged to charge for bags:

  • For unpacked blades, including knives, axes, and razor and knife blades
  • For treatment medicine
  • Used for a service such as dry cleaning, and not for sale of goods

Live Fish and Aquatic Creatures

Retailers are not obliged to charge for bags containing aquatic creatures or live fish

Why there is a charge on plastic bags?

The scheme intends to decrease the usage of plastic carrier bags that can only be used at once, and encourage United Kingdom citizens to re-use bags.

In 2014, in excess of 7.6bn ‘single-use bags of plastic’ were provided to customers by key supermarkets in England. This is almost equivalent to ~140 bags per individual, equal to about 61,000 tonnes in total.

The problem with plastic bags is that they take a longer time than any other bag to degrade and are a threat to wildlife.

In spite of research indicating that the usual household even now had 40 plastic bags, the amount of plastic bags increased for the fifth year running in 2014.

In the similar manner as England, 5p charges are even applicable in place across Northern Ireland, Scotland, and Wales. The government estimated that for 10 years the advantage of the scheme will include:

  • An anticipated overall advantage of greater than £780 million to the United Kingdom economy
  • Carbon savings of £13 million
  • £60 million savings in mess clean-up costs
  • In excess of £730 million raised for good causes

Related Topics:

What is climate change levy and rates for 2018-19? What are the exemptions?

Environmental Taxes, Reliefs and Schemes for Businesses

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