UK Industry Groups Raise Concerns Over Rising Costs of Packaging Compliance

British Brands Group and other trade bodies call for better alignment of packaging regulations, reduced administrative burdens and greater consideration of consumer price impacts

The British Brands Group (BBG), alongside trade bodies representing multiple UK sectors, has raised concerns about the cumulative costs and administrative demands of the country’s evolving packaging tax and regulatory framework. The organisations are calling on the government to assess how different packaging measures interact and whether their combined costs are proportionate to the environmental benefits they are intended to deliver.

The groups recognise the importance of reducing unnecessary packaging, increasing recycling, encouraging the use of recycled materials and ensuring producers contribute appropriately to packaging waste management. However, they argue that the interaction between different regulatory requirements is creating increasing complexity for businesses and consumers.

Multiple Packaging Regulations Increase Compliance Burdens

The concerns relate to several measures, including Packaging Extended Producer Responsibility (pEPR), Plastic Packaging Tax (PPT), Packaging Recovery Notes (PRNs) and the forthcoming requirements of the European Union’s Packaging and Packaging Waste Regulation (PPWR).

According to the organisations, businesses face overlapping reporting requirements, different payment arrangements, separate timelines and inconsistent data requirements. The groups say these obligations create administrative costs in addition to direct financial charges.

The EU’s PPWR is also expected to affect businesses placing products on the market in Northern Ireland or exporting to the EU.

The impact extends across packaging manufacturers, food and drink producers, cosmetics and personal care companies, medical device suppliers, breweries, horticulture, construction and hospitality businesses.

Businesses Report Higher Packaging Costs

The letter states that members have experienced significant cost increases since the introduction of the reforms. One large multinational company reported that its total UK packaging-related costs had reached approximately twice the norm in comparable European countries, without a corresponding improvement in packaging recovery.

Some smaller brands have reportedly found that increased regulatory expenses prevent them from employing in-house specialists to assess alternative packaging solutions. According to the letter, this can leave businesses continuing to use existing plastic packaging rather than investing in alternatives.

A UK fine-fragrance importer and distributor has also had to develop a dedicated system to convert overseas brand-owner packaging data into biannual pEPR submissions. An Environment Agency audit required detailed supporting evidence, including the weight of void fill in each carton.

The same data also determines the company's PRN obligation. However, the letter reports that wood PRN prices rose from around £7.50 per tonne in the previous year to more than £100 per tonne. Despite the increase, wood PRNs remain largely unavailable, leaving the business unable to meet its obligation even at the higher price.

Industry Groups Highlight Potential Consumer Price Impacts

The organisations argue that government estimates of the inflationary impact of pEPR may understate the effect on individual products and sectors.

According to the letter, the Department for Environment, Food and Rural Affairs (DEFRA) estimated that pEPR would add 0.07% to the Consumer Prices Index (CPI) and have a projected impact of 0.37% on the Retail Prices Index (RPI). The groups contend that the impact on food and drink could be substantially higher because these categories account for less than 20% of the RPI basket but more than 80% of EPR fees.

The letter refers to anonymised examples from the first quarter of 2025 showing projected inflationary impacts from EPR alone, excluding PRNs and PPT.

The groups also point to wider cost pressures affecting households. Between January 2020 and July 2025, UK food and non-alcoholic drink prices rose by 37%, compared with a 28% increase in overall UK prices. Milk, cheese, eggs and oils recorded the steepest increases.

The Food & Drink Federation's forecast cited in the letter predicts that food and non-alcoholic drink inflation will reach 3.9% in December 2026, with the inflation rate over 2026 at 2.8%. It also forecasts inflation of 5.5% in 2027, peaking at 6.4% in July 2027.

The letter states that rising costs across energy, ingredients, transport, logistics and packaging could reverse the recent slowdown in food inflation.

Call for a More Coordinated Packaging Policy Framework

The British Brands Group and supporting organisations have asked the government to take a more comprehensive approach to packaging policy. Their requests include discussions on:

• How different packaging measures interact in practice and where unintended consequences have emerged.
• Whether the combined financial and administrative burden on businesses is proportionate to the environmental benefits.
• How greater certainty can be provided for businesses making long-term investment and packaging decisions.
• How regulatory systems can be better aligned, with consistent incentives for innovation, recyclability and packaging waste reduction, particularly as the Deposit Return Scheme is due to begin for drinks manufacturers in 2027.
• How the impact of packaging measures on consumer prices can be assessed and incorporated into future policy development.

Balancing Environmental Objectives and Business Competitiveness

The organisations said their members have experience in packaging redesign, investment in sustainable materials, supply-chain engagement and responding to consumer expectations. They believe this experience can help identify where current policies are working and where interactions between different measures may be producing unintended outcomes.

The letter concludes with an offer to meet government representatives alongside industry members and other signatories to discuss ways of delivering environmental improvements while maintaining business competitiveness and protecting consumer choice and affordability.