Spain: New indirect tax on non-reusable plastic packaging starting 1 January 2023
The Spanish Congress has passed Law 7/2022 of 8 April 2022, which covers tax law on non-reusable plastic packaging and will enter into force on January 1, 2023. The Law intends to encourage the reduction of non-reusable plastic packaging waste as well as the recycling of plastic waste. It also aims to establish the concepts of the circular economy by basic waste regulation, as well as to contribute to climate change mitigation and marine environmental protection.
Scope
- Non-reusable plastic containers
- Products made of semi-finished plastic that will be used to create non-reusable packaging
- Products made of plastic that are meant to be used to close, trade, or display non-reusable containers
Taxable Event
- Production – when the first delivery is made to the purchaser. In the event of advance payments, the tax is due when the entire or a portion of the purchase price is actually collected.
- Importation – when import duties are accrued. The plastic tax is required when the import is processed at customs, at the same time that the customs duties are due.
- Intra-Community acquisition – when transport of the goods begins on the 15th day of the month after transport, or when the invoice is issued – whichever comes first.
Tax Rate
The new tax has a broad scope, with a tax rate of EUR 0.45 per kg of non-recycled plastic packaging. It is expected to generate around EUR 724 million in revenue for the country annually.
Taxable Person
In principle, sole proprietors and businesses that are manufacturers, intra-Community acquirers, or importers of plastic-taxable items. Foreign taxpayers subject to the Spanish plastic tax are required to designate a Spanish representative before engaging in their first taxable activity.
By no later than January 30, 2023, taxpayers subject to the Spanish plastic tax must register in the special register for plastic tax.
Exemptions
The law has several exemptions, including:
- Medicines, sanitary products, special medical meals, and sanitary hazardous wastes
- Products that are unsuited for use or have been destroyed
- Plastic packaging sent outside the borders of Spain
- Low-volume operators: intra-community acquisitions and imports of non-reusable plastic packaging weighing less than 5kg per month.
For these similar instances, a refund system will be designed to accommodate cases when the tax has already been paid and has to be reimbursed.
Structure
It is structured similarly to Italy’s new plastic packaging tax, which is also set to go into force on January 1, 2023. However, there are significant distinctions when compared to the plastic packaging tax that has been in place in the United Kingdom from April 1 this year.
Key Takeaway
The legislation will go into effect on January 1, 2023, and taxpayers will be required to:
- register in a special registry;
- submit monthly or quarterly tax reports (depending on their net turnover), and;
- adhere to reporting requirements.
Businesses subject to this tax should evaluate their compliance duties as well as any updates and guidance released by the Spanish Tax Authorities. GVC can help you with your plastic packaging tax compliance. Contact our experts via email!
Source: boe.es
