Latvia’s New Plastic Tax: A Push Towards Sustainability
by Alena Zein at 15:02 in Circular Economy, Packaging, Environmental
Latvia has amended its Natural Resource Tax by establishing a tax on plastics that are typically not recycled in Latvia. Starting from 1st October 2024, any taxable person responsible for packaging made entirely or partially of non-recyclable plastic (polymeric) materials will be subject to this tax.
The tax was introduced in response to the European Union's 2021 resource tax on non-recycled plastics in each member state. Each state has discretion over how it funds its payment to the EU for its share of unrecycled plastic waste. This blog will walk you through the key details of the tax.
Extended Producer Responsibility (EPR)
The tax is in line with Latvia's established Extended Producer Responsibility (EPR) system, which requires producers to take responsibility for their products' entire lifecycle, especially regarding waste management and recycling. Consequently, producers of plastic packaging will bear the costs associated with their products' disposal, encouraging the development of more sustainable packaging options. This approach drives innovation in the packaging industry, prompting companies to explore alternative materials and plastics that are more easily recyclable.
How much will it cost?
Latvia's plastic tax imposes a fee of €0.80 per kilogram on packaging materials made from plastic that cannot be recycled. This rate is aimed specifically at plastics that are either non-recyclable or have very limited recycling potential. By targeting these materials, the tax encourages the use of more sustainable, recyclable packaging alternatives. The goal is to reduce the environmental impact of hard-to-recycle plastics and promote better waste management practices in line with EU sustainability targets
Who is impacted?
The obligation to pay Latvia's plastic tax falls on:
- Manufacturers of non-recyclable plastic packaging that is placed on the Latvian market
- Importers who bring non-recyclable plastic packaging into Latvia
- Distributors involved in the sale or distribution of non-recyclable plastic packaging within Latvia.
How can producers comply with this tax requirement?
Producers can meet Latvia's plastic tax requirements by joining the Producer Responsibility Organization (LZP), which is responsible for overseeing plastic waste management in the country. The tax will be reported through this system rather than directly to the government. By joining LZP, producers will fulfil their legal obligation to report and pay the tax on non-recyclable plastic packaging as part of their participation in the country's extended producer responsibility (EPR) program. If producers choose not to participate in this program, they are responsible for paying the tax themselves.
If you're wondering how this tax will impact your business, feel free to reach out to us today: Contact - Lorax EPI. We're here to help you navigate the details and ensure your compliance with Latvia's plastic tax.
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