A 5p single-use plastic carrier bag tax was introduced in England in October 2015. From 21 May 2021, it was increased to 10p and extended to all retailers, regardless of size. 

This is a freeview 'At a glance' guide to the single-use plastic carrier bag tax. 

At a glance

  • From 5 October 2015, large retailers in England were obliged to charge a minimum of 5p for single-use carrier bags, bringing them into line with Scotland, Wales and Northern Ireland.
    • A large retailer was one with more than 250 employees.
    • Small and medium-sized retailers with fewer than 250 employees did not have to apply the charge but could do so voluntarily.
  • From 21 May 2021, the single-use carrier bag charge increased from 5p to 10p. 
  • The charge is subject to VAT.
    • If a retailer is VAT registered and sells a bag for 10p, VAT of 1.67p is paid to HMRC.
  • Businesses are encouraged to donate the profits from the carrier bag charge to charity.
  • Tax relief applies to donations by companies. Tax relief is given via Gift Aid for partnerships or sole traders.
  • Large businesses with more than 250 employees are required to make annual sales reports to the Department for Environmental Foods and Rural Affairs (DEFRA).
  • There are penalties for failure to make changes, or to keep or supply records.
  • There are exemptions for bags supplied with certain items or goods such as medicines or unwrapped foods.

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