/ 26 February 2003

Budget: “environmental” tax on plastic bags

As part of its fight against the proliferation of plastic bags across the South African landscape, the government has decided to introduce a levy on plastic bags, with some of the revenues earmarked for the recycling of the bags.

The National Treasury announced the new measure as part of its new budget for the 2003-04 financial year on Wednesday. It will replace the Minister of Environmental Affairs and Tourism’s efforts to introduce legislation banning the manufacture and use of certain types of plastic bags, the Minister has agreed.

While not specifying the amount of the levy, the Treasury said it would take the form of a duty in terms of the Customs and Excise Act, and the South African Revenue Service (SARS) would be the collecting agent.

“This environmentally related fiscal instrument could serve as a case study for the introduction of other environmentally related fiscal instruments in support of the ‘polluter pays’ principle,” the Treasury said.

“The Environmental Tax study commissioned by the Treasury last year will be released for comments as a discussion document later this year. The outcome of

this process should present options for environmentally related fiscal reforms in support of a sustainable development path.” – I-Net Bridge