The Australia Institute calls for plastic tax to address ‘inefficient’ recycling

The Australia Institute, an independent public policy think tank based in Canberra, is calling for a plastic tax in Australia. In a new report, the institute claims existing policies to curb plastic waste aren’t working and should be replaced by a plastic tax and Extended Producer Responsibility (EPR) scheme.

Data shows that plastic consumption in Australia rose by 116% between 2000 and 2020-21. The study defines consumption as the total use of plastic by Australian industry and consumers, including locally made as well as imported products.

The report then compares Australia’s annual consumption of plastic with the amounts that are disposed and recovered. Results show that Australia has consumed a total of 56.9 million tonnes of plastic since 2000. More than half of this – 31.9 million tonnes – has been disposed of, while just 5.8 million tonnes have been recovered. That means that only about 15% of all plastic waste generated over the last 20 years has been recovered through recycling, composting, or energy recovery.

“Recovery has not kept pace with the increase in waste,” the report says. “Only 14% of plastic waste generated in 2020–21 was recovered – this is a decline from a high of nearly 18% in 2008. Over a 20-year period the rate of recovery has, at best, remained stable, and at worst – as an Australian Government report states – is ‘even trending down’,” the authors added.

As to why plastic recovery has not kept pace with consumption and waste production, the report’s authors say ‘to put it simply, plastic recovery is difficult and costly… In other words, plastic policy in Australia has historically focused more on increasing recycling rather than reducing consumption. But the problem is that there is too much plastic and, as this research makes clear, we cannot recycle ourselves out of the problem. Reducing plastic consumption needs to be an explicit policy goal if waste is to be reduced’.

In response, the authors suggest Australia follows the footsteps of the European Union and the United Kingdom in introducing a plastic tax to help reduce plastic packaging. It estimates that if Australia taxed virgin plastic packaging at the same rate as the EU (€800 per tonne), it would translate to a tax of approximately AUD 1,300 per tonne.

The latest Australian Packaging Covenant Organisation report estimates that 1.179 million tonnes of plastic packaging was placed on the Australian market in 2020-2021. Of this, approximately 1.12 million tonnes are estimated to be sourced from virgin feedstocks.

“If the estimated consumption of virgin plastic packaging was taxed at this rate, it would raise $1.457 billion. To put this into context, the Australian Government’s Recycling Modernisation Fund – which is for many kinds of waste besides plastic – is worth just $250 million. Such a tax on plastics would provide nearly six times that amount,” the report says.

The authors conclude that making virgin plastic more expensive would encourage companies to move towards more sustainable materials or more recyclable forms of plastic. It would also, they argue, make recycle plastic more competitive with virgin, ‘therefore providing a financial incentive for industry to change its ways’.