New Plastic Tax More recycling, more money—is it really that simple?

The CDU/CSU and SPD want to use a new tax to encourage companies to reduce their use of plastic. They also hope this will generate significant revenue for the budget. Business associations are criticizing the proposal. 

Recycling is important, and it’s well-received—and yet recycled materials have a major drawback: They are generally more expensive than virgin material. That is exactly what is now set to change. The federal government is planning to fast-track the introduction of a “plastic tax.” This is evident from a draft bill that has been made available to the editorial staff. 

According to the plan, the fee will be 550 euros per metric ton of plastic in packaging. With prices ranging from 1,000 to 2,000 euros per metric ton of PET plastics, for example, this would make a real difference, according to a report in the Süddeutsche Zeitung (€), this would make a real difference. 

Accordingly, the following are subject to tax: plastic packaging, plastic films, and composite packaging, provided that their plastic content exceeds five percent. The tax is to be levied on the manufacture, distribution, or import of the relevant packaging. For packaging made from recycled plastic, the tax may be waived upon request.

Associations Reject Expedited Procedures Without Ministry Involvement

In a letter to Minister of the Chancellor’s Office Nina Warken (CDU), business associations warned against introducing this tax “through a fast-track procedure” without the involvement of other ministries or a cabinet decision. In the letter, the associations stated that, “according to the information available to us,” the Ministry of Finance intended to forward draft wording for the introduction of the new tax to the Bundestag’s Budget Committee at short notice—it was then to be introduced as an amendment to the already ongoing proceedings on the 2027 Budget Accompanying Act. 

“We urge you to work to ensure that a new excise tax of this magnitude is not introduced into the parliamentary process in this manner.” Instead, the associations called for a prior assessment of the economic, administrative, and environmental consequences—with the involvement of the National Regulatory Review Board—including the compliance burden on businesses, the personnel, IT, and enforcement needs of the customs administration, as well as potential impacts on material substitution, packaging weight, recyclability, and greenhouse gas emissions. 

Billions in revenue projected, tax debtors unknown

The letter was signed by eight associations, including Plastics Europe Germany (PED). PED Executive Director Dr. Christine Bunte also stated: “The draft contains a striking contradiction: It estimates up to 1.5 billion euros in tax revenue and nearly 800 additional customs positions, yet at no point does it specify the number of companies that will actually be subject to the tax.” 

Even more surprising is that the tax is linked to the so-called “production” of plastic packaging—a term that has not existed in packaging law until now. “Anyone introducing new taxes worth billions should first be able to clearly state who will pay them. Otherwise, the legislation risks turning into a national tax experiment,” Bunte continued.

Background: The bill is expected to generate approximately 1.485 billion euros annually for the federal government starting in 2028. At the same time, government costs for implementation are estimated at 283.5 million euros through 2029, along with 788 additional full-time positions at the customs administration. Businesses are expected to face additional administrative costs of approximately 44.1 million euros annually. The reported administrative costs are significantly lower than the figures discussed by the Federal Environment Agency in its research project 87/2025 for comparable packaging tax models. The draft does not explain the reason for this significantly lower estimate.

Support from Umwelthilfe

In contrast, the German Environmental Aid organization has expressed support. It supports the tax in principle, writes Der Spiegel. However, it calls for the tax to apply exclusively to single-use packaging—reusable packaging should not be subject to the tax. In addition, the levy should be extended to other packaging materials such as paper, cardboard, and metals to prevent companies from switching to alternative materials.