U.S. to levy $300 extra tax on all plastic raw materials

On October 5, the American Plastics Industry Association, on behalf of 67 companies, urged the US Congress to abolish the 20 cents per pound tax rate on all plastic raw materials in the $3.
5 trillion budget adjustment plan
.
In a letter to both houses of Congress, major U.
S.
plastics producers expressed concern about increased costs across the plastics industry chain and a decline in the competitiveness of U.
S.
manufacturing
.

Companies that signed the letter included Chevron Phillips, Eastman, Epsilyte (a major North American EPS producer), Exxon Mobil, Formosa, Lyon 67 major North American plastics producers including Lyondell Basell, NOVA Chemicals, Basic Innovative Plastics America (SABIC), Shell and Westlake Chemical
.

While they are committed to increasing the amount of recycled resin, the proposed tax ignores supply constraints due to limited supplies of recycled resin, particularly food-grade packaging
.
Lawmakers have yet to fully review the proposed tax through the regular legislative process that includes expert analysis and public debate
.

The letter, signed by major chemical companies, follows another similar letter sent to Congress last week by 23 trade associations
.

In August, U.
S.
Democratic Senator Sheldon Whitehouse proposed the first tax on virgin resin in the REDUCE bill
.
The bill applies the fee to single-use products, including plastic packaging, beverage containers, bags and food service products
.

Proceeds from the 2022 tax of 10 cents per pound proposed by the REDUCE Act will be used to create a Plastic Waste Reduction Fund to implement initiatives to reduce plastic waste and increase recycling rates
.
Now, the 20-cent/pound tax is one of several options the U.
S.
Senate Finance Committee has highlighted to pay for the budget reconciliation bill
.

As the details of the spending bill are still being discussed, the proposals may need to be developed further before being incorporated into any legislation
.

Notably, the Plastics Industry Association (Plastics) is the only organization that supports the entire plastics supply chain, which represents nearly 1 million workers in the $395 billion U.
S.
industry
.
Since 1937, Plastics has worked to improve the global competitiveness of its members and industry, while promoting recycling and sustainability
.