Plastics in the EU: are we doing enough?

The latest fiscal measure presented by the Italian government, and now to be examined and approved by the Senate, has been and still is subject of debate - one of its most controversial points being Article 79 of the Legislative Decree n.124/2019. Not surprisingly, I might add, as it deals with one of the hottest topics of the moment, that one word that is hard to pronounce in front of green enthusiasts, the evil of our times - plastics.

Article 79 of the Decree, referred to as the ‘plastic tax’, proposes a one euro fee for each kilogram of plastic produced. As the Italian Environment Minister Sergio Costa stressed, the Decree follows measures recommended by the EU and aims to discourage the use of single-use plastic products (SUPs) and to reward with a tax credit firms which invest in biodegradable materials and in more sustainable production processes.

Although the intention of the legislation seems noble, it faces quite a significant opposition - some argue that the plastic tax could prove to be very detrimental not only for the whole food supply chain, which comprehends 76% of all plastic packaging, but for consumers too as the rise in firms’ costs of production could generate price inflation.

Whatever your opinion on the plastic tax is, you cannot argue against the fact that it has had at least the positive effect of putting the topic in the spotlight - as it already happened in other European countries. Similar measures supporting environmental policy are certainly not new to the European Union.

The EU budget as a ‘driver of sustainability’

Many EU politicians agree that a plastic tax would be a reasonable source of revenue. For example, Karmenu Vella, the European Commissioner for the Environment, Maritime Affairs and Fisheries, has stated that “the EU budget must be a driver of sustainability”.

In October 2019 the European Commission met to define the guidelines for a balanced EU long-run budget for 2021–2027, and agreed that the EU has to “identify new source of financing” and to “forge a closer link between the budget and policy priorities, such as climate policy”. The measures discussed can be described as ‘ambitious’ - the Union plans to devote at least 25% of its spending to climate objectives.

A suggested source of revenue would be a levy of €0.8/kg of plastic packaging waste that cannot be recycled. Many argue that it would be a ‘regressive’ form of taxation in the sense that it would hit poorer EU countries rather than rich ones, but Finland, which now holds the six-month EU presidency, claims that this is the measure of the budget proposal which has gained the widest support across member states.

What's so bad about plastics?

Plastics, as highlighted by the first ever European Strategy for Plastics in a Circular Economy adopted in January 2018, are one of the “key challenges of today”. The sector is critical for the European Union, employing 1.5 million people and generating a turnover of €340 billion (in 2015). However, plastics production and incineration emits 400 million tonnes of CO2 globally each year. Moreover, Europe generates 25.8 million tonnes of plastic per year, only 30% of which is recycled: 150,000 to 500,000 tonnes of plastic waste enter the oceans. SUPs such as drinks bottles, crisp packets, cups, cutlery and straws are among the top ten polluting items most commonly found on beaches.

The Organisation for Economic Co-operation and Development (OECD)’s report released in September 2018 for G7 Environment, Energy and Oceans Ministers highlights how all countries need to “rethink the use that is being made of plastics more generally” and to “restructure the way waste material is handled”. In particular, the weakness of the EU market for recycled plastics was unmasked by the recent import restrictions on plastic waste. The EU - and the rest of the world - used to exploit Asian countries’ cost advantage with respect to sorting and recycling - China, in particular, used to import 60% of global plastic waste. Following 2017 changes in China's regulations, however, EU exports to China fell from 100,000 tonnes per year in June 2017 to 10,000 tonnes per year in January 2018 - now, new policies are needed to address the issue at all stages of the life cycle of plastic products. Such policies, according to the OECD, need to be effective both on the supply and on the demand side. The report suggests some possible regulations, such as taxes on plastics production and consumption, new standards for recycled contents and labelling, and measures to increase consumers’ awareness and environmental education.

The goals that have been set...

Despite the delicacy of the issue, the European Union is doing pretty well compared to the rest of the world - it has already set more strategic objectives than we may be aware of.

We hear a lot about the EU Action Plan for the Circular Economy adopted in 2015, and the European Commission’s active engagement in the Paris agreement on climate change. Fewer readers will be familiar with Horizon 2020, the financial instrument implementing the Innovation Union, available for 7 years from 2014 to 2020, which has already provided more than EUR 250 million to finance R&D in the development of materials to substitute plastics. Lastly, the above mentioned European Strategy for Plastics in a Circular Economy has set some key objectives to reach a ‘new plastics economy’ which would promote reuse and recycling in the plastics sector - among them, increasing recycling rates up to 50%, improvements in sorting and recycling capacity and the reduction of Europe’s dependence on imported fossil fuel by 2030. Making the design of products more recycling-friendly, implementing the separate collection of plastic waste and creating profitable markets for recycled plastics are the main challenges of the plan.

...and how to reach them

But what can the EU practically do to achieve its sustainabi