Eco-tax on degradable plastic bags slashed

The eco-contribution on plastic bags will now be charged per item instead of per kilo after the government yesterday announced it would be making an amendment to the Eco-Contribution Act, just one week after it came into force.

Under the amendment, bags made of normal plastic will be charged a tax of 6c each and degradable bags will have an eco-tax of 1c per item. Bio-degradable bags will not be taxed at all, as under the original legal notice.

The eco-tax, which came into force on January 1, was originally set at Lm10.67 per kilo, and Lm5 per kilo for the degradable bags, causing a furore among retailers and manufacturers who were stunned by the magnitude of the tax.

This charge was in effect penalising the more environment-friendly degradable bags, which are heavier than the ones made of normal plastic. A single degradable bag, of the type used to dispose of garbage, would have ended up being taxed about 17c - far more than the normal bag - pushing its cost to the consumer up to 21c. Now it will cost 5c6, or 56c for a batch of 10.

The move has been welcomed by various sectors.

"Following meetings we have had with the Federation of Industry and in view of the initial reactions we will be amending the legal notice," Environment Minister George Pullicino said at a press briefing yesterday.

Dr Pullicino dismissed remarks that the government had not made its calculations before the legal notice came into force and insisted that the government had been advised by the private sector to base the tax on weight.

"Though this advice was given with all the good intentions, it has created an anomaly so we are reverting to our original idea to tax plastic bags per item instead of by weight," he said.

Dr Pullicino said plastic sheeting used by farmers to cover their seedlings was exempt from this tax, as was plastic used in industrial processes.

As for those who are concerned about how they will be disposing of their rubbish, Dr Pullicino said degradable bags were readily available in numerous outlets. "It pays the consumer to choose degradable plastic bags because with the introduction of the eco-tax these will be about 3c cheaper than the normal bags," he said.

Longbow Ltd, importers of degradable bags, have in fact welcomed the new eco-tax because its environmental benefits were finally being recognised.

Company director Ben Farrugia said that in the past few days they had been inundated with calls from people requesting degradable bags.

However, bio-degradable bags are not so readily available and Christopher Ciantar, WasteServ's head of strategy and development, said he was sure many will be looking at investing in this sector to meet the demand.

Traplas Ltd, a plastic packaging company, is already looking into the production of bio-degradable bags at competitive prices.

The majority of Traplas employees were on Tuesday ordered out on forced leave as the management felt the new eco-tax would be unsustainable.

When contacted yesterday Traplas director Robert Abela said he welcomed the revision of the eco-tax and added it would be business as usual on Monday with all employees back at work.

"Of course the situation will not be normal because there will be a downturn in the use of plastic bags. However, there will now definitely be no redundancies and the company, though already producing degradable bags, will start working to produce bio-degradable ones," he said.

Mr Abela just wished that the company had been given a transition period to deal with the introduction of the eco-tax.

The FOI welcomed the significant adjustments to the eco-contribution mechanism.

Meanwhile, to compensate for the eco-tax on plastic carrier bags, numerous supermarkets and shops are providing consumers with the option of buying a reusable cloth bag at 25c.

These are being provided by WasteServ and a staggering 12,000 bags were sold between Thursday and yesterday. Another consignment of 30,000 bags is expected to arrive at the end of the month.

Dr Pullicino, flanked by Dr Ciantar and Tonio Fenech, Parliamentary Secretary for Finance, was speaking at SISA Supermarket, in Sliema to launch the cloth bags.

The bags are set to be distributed to every Form 1 and 2 student to encourage them to adopt an environment-friendly attitude and to pass on the message to their family.