Friday 2 October 2015

Finance Fridays – The carrier bag charge

Carrier bag charge tax England Defra plastice single use

Welcome to Finance Fridays a new weekly series focusing on all matters money. It's going to be open for other people to link up their financial posts and full details are below. Firstly onto this week's feature and it's all about the humble carrier bag.

Wales and Scotland have had it for a while but on Monday 5th October 2015 it is coming to England – it is the carrier bag charge or to give it its official title The Single Use Carrier Bags Charges (England) Order 2015. Unlike in Northern Ireland it is a charge rather than a tax. In Northern Ireland the money goes straight to the Northern Ireland Department of the Environment.

What is it?

It is a charge of a minimum of 5p to be levied against single use plastic carrier bags.

What does it apply to?

All retailers with 250 or more full-time equivalent employees across the entire business and not just in an individual store. Franchises need only count the number of employees in their part of the business. Note – this is not just supermarkets but all your favourite high street stores.

Smaller businesses can voluntarily opt-in to the scheme.

A single use carrier bag is defined here. It does not apply to paper bags, cotton or jute bags or multi-use plastic 'bags for life'.

Online deliveries

Supermarket delivery orders are notorious for using far more plastic bags than necessary. As the charge has already been in force in Scotland and Wales the supermarkets have come up with standard charges for orders. Tesco and Sainsbury's charge a flat 40p per delivery based on an average use of eight bags per customer order. You can opt for a bagless delivery but that may mean your shopping is piled up in your hallway! Certain shops are now offering refunds if customers hand back their bags. The individual shops' policies are changing all the time in response to customer feedback so check at time of ordering.

What is exempt?

There are a list of certain items that the Department for Environment, Food and Rural Affairs (Defra) have said can be exempted from the charge for health and safety purposes. To clarify this they sent out this informative tweet.


Be warned though that if you mix an exempted item with a non-exempted item a charge for the bag will be applicable. Therefore if you a put a box of cornflakes in bag of loose apples you will be charged but if you put pears in with the apples you won't be.

Where does the money goes to?

At the end of each reporting period the retailers will need to file a report on how many bags they have given out and how much money they have received from the associated charges. As it is not a tax it is up to the retailers what they do with the proceeds. It is expected that the retailers will donate the proceeds to charity and good clauses. The reporting form will ask the retailers what they have done with the money and this will be available to the public to view. Effectively they can be named and shamed.

Some large retailers have already announced their chosen charities. Morrisons will be giving to Sue Ryder, Superdrug's proceeds will be going to Marie Curie Cancer Care and from this month all of Boots' UK bag charge proceeds will be sent to Children in Need.

As it is not a tax in England the Government doesn't directly benefit financially from the charge. However it is expected to make £19m a year from the VAT on the sales of the bags.

Why is it needed?

Last year over 7.6 billion single use plastic bags were distributed by just supermarkets in England. Per person that equates to 140 per person and a whopping 61,000 tonnes. Each of these bags take 10-20 years to decompose in landfill centres. Those that don't make it to landfill cause litter and major damage to wildlife and marine life. It is estimated that up to £60 million will be saved in clear up costs. Since the charge was introduced in Wales three years single use plastic bag consumption has dropped by 79%.

How to avoid the charge

Simply by remembering to bring your own reusable bags, trolley bags or boxes. You could also not bag individual items that you would normally pop into a plastic carrier. For example if you just buy a bottle of milk carry it using the handle rather than paying for a bag to put it in.

Finance Fridays linky

If you want to join in with this week's Finance Fridays then add your link to the linky below. Any post concerning financial matters is allowed. Full details here. It doesn't have to be published today as you have until 23.55 on Tuesday 6th October 2015 to join in. Grab my badge below for your blog post.
Finance Fridays

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23 comments:

  1. Great idea for a link up and an informative post. I shop with Ocado and was worried about paying OTT for this as they overuse bags in my opinion. They will charge 5p a bag but will let you sell bags back to them for 5p a go too - and they take any bag, not just their own. They don't offer bagels deliveries as it would have an impact on their delivery schedule and I think that's fair enough. It'll be interesting to see how this goes. In M&S they've been charging for a while and I'm proud to say I've never bought one once! I've changed my habits and always have one of those small foldable canvas bags in my handbag. I mean they're almost as ubiquitous as carrier bags ;) x

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    1. I have at least two cotton bags in every one of my handbags. I think though for large items it might be a bit much to start carrying around bin bags!

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  2. Such a great step forward. Have to agree with Stephanie above about online shopping in the UK. I used to despair at the amount of carrier bags they gave us with our delivery. Would be great if supermarkets had reusable bags that you handed back at the next delivery! :)

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    1. I would have thought they could ask for a deposit for the plastic crates they deliver them in. I think most people who use online deliveries do so regularly so would be happy to hand it back next time.

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  3. We're regular visitors to Wales and they've had this for quite some time now. It's a great idea and I'm sure it won't take people long to change their habits.

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    1. I think a lot of people don't realise it's all large stores and not just supermarkets. That's where the shock is going to come!

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  4. I bought a few bags for life and take them shopping with me now. You say they don't charge for paper bags but McDonalds charge 5p

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    1. The rules covering what bags are chargeable are different in Scotland than what is coming into force in England.

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  5. Yes just seen about this in the last few days not sure how well it will work.

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  6. I have no issues with paying for carriers. I shop at Lidl and Aldi so already always tek my own. In fact this has been a long time coming

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  7. I was talking to my Tesco delivery guy about this - he said you can ask to take the crate to your kitchen to unload if you go for bagless deliveries ;)

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  8. I rarely use the bags the supermarkets provide anyway and I always have some reusables in the car or my handbag. I am really pleased with the change to be honest as I really hate seeing people using the free bags in supermarkets instead of bringing their own. Hopefully this will force a change in behaviour.

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  9. I wish they'd bring the charges over to Dubai, if I buy milk and a tin of beans they'ed pack them in separate bags, I try to do my own packing but it's difficult to get rid of the bag packers. i take my own bags and most times while I'm emptying my trolley they start packing in plastic bags, which they then pack in my bags, which i then promptly unpack as they carry on. I've given up caring what they think. In the UK the till areas seem to have shrunk making unpacking your trolley and repacking using your own bags very difficult and I they're also under pressure to scan items quickly.

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  10. Thanks for this informative post - I am glad to see that some large retailers have chosen charities to donate to from the bag charge. I always have bags for life in the boot of the car so I rarely take carrier bags, but they do come in handy to re-use as bin liners in the small bins at home!

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  11. We get Tescos to deliver and they are a nightmare for giving you a bag for every item, I do tend to reuse them as nappy bags though!

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  12. I think it is a brilliant idea. I used to work for a supermarket and have seen them get chucked into pushes and pushed down drains etc - I have used my own bags for sometime, you just have to remember to put them in, and get them out the car

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  13. I think the charge is an excellent idea. We've kept reusable bags in the boot for a few years now in order to try and reduce our carrier bag consumption. I opt for bagless deliveries with Tesco but we still seem to end up with lots of single use carrier bags so we use them as bin liners which saves us money on buying a roll of bin liners! It'll be cheaper to buy the bin liners now than pay 5p per bag now though :)

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  14. Thanks for explaining this new charge - I new it was happening but wasn't sure of the details.

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  15. Thanks for this post. I knew about it but not the ins and outs. Glad to see they are planning on donating to charity

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  16. I have really mixed feelings about all this. The consumer is always the one having to pick up the pieces of our global waste but there is very little pressure on the manufacturers to limit their packaging or to make products last longer or even make them cheaper to repair.

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  17. The interesting one will be going clothes shopping, I can't imagine having enough bags with me for a seasonal haul and if I use my old bags, that will be fun. Might be a laugh to go into a 'posh' shop and carry the goods out in a pound shop bag ;) I wonder when clothing retailers will mostly offer paper bags to keep the look.

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  18. Well I'm all for reusing bags, but like it has been said going clothes shopping could be a challenge especially places like primark.

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  19. i think everyones being rather silly with it all, im all for reusing bags but i have seen the clause in this new law where we dont actually have to pay for them if they have the shop brand on the carrier as it is classed as us paying them to adverise their shop lol

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