The Italian plastic tax – an overview

The so-called Italian “plastic tax” is a tax on the consumption of single-use plastic manufactured goods (manufatti con singolo impiego, hereinafter “MACSI”). It was introduced in art. 1, paragraphs 634 – 658, of Law 160/2019, in order to disincentivize the production of single-use plastic products, in implementation of Directive no. 2019/904/EU.

The application of the plastic tax has been deferred since its introduction in 2019. Contrary to what has been speculated by some in the media, Decree Law 41/2021 (the so-called “Decreto Sostegni”), published in the Official Gazette no. 70 of March 22, 2021, does not provide for a new deferment of the plastic tax. Therefore, unless further extensions are granted by future regulatory measures, the plastic tax will become effective from July 1, 2021.

Defining the concrete modalities of applying the tax has been delegated to a decree by the Director of the Customs and Monopolies Agency. This decree has not yet been issued. However, during the Open Hearing held on February 18, 2021 and dedicated to the plastic tax, the Customs and Monopolies Agency gave a preview of the draft decree. The text of the draft decrees is still subject to amendments.

On which products does the plastic tax apply?

The tax applies to products intended for the “containment, protection, handling or delivery of goods or foodstuffs” made using “plastics consisting of organic polymers of synthetic origin” and basically not designed to be used repeatedly (single-use products).

The draft decree contains a non-exhaustive list of manufactured goods that are included among the MACSI subject to tax. These include plates, preforms, bottles, caps, containers, lids, bags, packaging, films, foils, and, and all other polymeric products, however shaped or mouldable, suitable to constitute a wrapping or part of a wrapping for goods or food products.

MACSI made with the use, even partial, of plastic materials consisting of organic polymers of synthetic origin included under customs headings 3901, 3902, 3903, 3904, 3905, 3906, 3907, 3908, 3909, 3910 and 3911 of the Combined Nomenclature of the European Union will be subject to the plastic tax.

Among others, the following are considered MACSI subject to the plastic tax:

• semi-finished products (including preforms) made with the use, even partial, of plastic materials, used in the production of MACSI;
• devices, made with the use, even partial, of plastic materials, which allow the closure, marketing, or presentation of MACSI, or of manufactured goods made entirely of materials other than plastic materials.

Exclusions

The following are excluded from the application of the plastic tax:

• MACSI that are compostable in compliance with UNI EN 13432:2002;
• medical devices classified by the Single Commission on Medical Devices pursuant to art. 57 of Law 289/2002;
• MACSI used to contain and protect medicinal preparations.

The tax is also not due on the plastic material contained in the MACSI that comes from recycling processes.

Subjects liable to the tax

Plastic tax is payable by:

• for MACSI produced in Italy:
  • the manufacturer; or
  • the seller, i.e., any entity, resident or not resident in Italy, that intends to sell MACSI, produced on its behalf, to other Italian entities.

The subject that produces MACSI using other MACSI on which the tax is due by another subject, without the addition of further plastic materials, is not considered a manufacturer;

• for MACSI coming from other EU Member States:
  • the purchaser, i.e., the subject who purchases the MACSI in the exercise of its economic activity; or
  • the transferor, if the MACSI are purchased by a private consumer;
• for MACSI coming from non-EU countries, the importer.

Tax liability

The plastic tax is triggered by:

• production of MACSI;
• introduction of MACSI into Italy from other EU Member States;
• definitive import of MACSI into Italy.

Plastic tax liability arises at the time of the release for consumption of the MACSI in Italy, which occurs:

• for MACSI produced in Italy, at the time of their transfer to other Italian subjects;
• for MACSI coming from other EU Member States, upon their purchase in Italy in the exercise of an economic activity, or upon their transfer to a private consumer;
• for MACSI coming from non-EU countries, at the moment of their definitive import in Italy.

The tax is not due for MACSI sold directly by the manufacturer for consumption in other EU Member States or exported.

Amount of the tax

The tax is fixed at 0.45 euro per kilogram of plastic material contained in the MACSI.

Payment and terms

For MACSI manufactured in Italy or coming from other EU Member States, the tax due must be paid:

• by the deadline for the submission of the plastic tax return to be filed with the Customs and Monopolies Agency (the deadline is the end of the month following the calendar quarter to which the return refers);
• exclusively by means of the F24 payment form, with the possibility of offsetting the amount with other taxes and contributions.

The draft quarterly plastic tax return forms have been published, and they require a list of detailed information.

For MACSI coming from non-EU countries, the tax is assessed and collected by the Customs and Monopolies Agency with the procedures provided for border duties.

The tax is refunded when unduly paid; the refund is requested, under penalty of forfeiture, within two years from the date of payment. The statute of limitations for the recovery of the credit is five years.

Penalties

In cases of non-compliance of plastic tax obligations, administrative penalties apply as follows:

• a penalty ranging from double to ten times the amount of tax evaded, in the event of failure to pay the tax;
• a penalty equal to 25% of the tax due, in the event of late payment of the tax;
• a lump sum penalty ranging from 250 to 2,500 Euro in the event of late submission of the plastic tax return and for any other breach of the relevant tax law provisions.

Implementing provisions set out in the draft implementation decree

The draft implementation decree sets out the obligations on all parties required to pay plastic tax.

The “manufacturer” of MACSI is obliged to:

• file electronically a specific prior communication with the Customs Office. This communication must contain a technical report, listing the types of MACSI produced, and indicating whether they are excluded, as well as a description of: the technical characteristics of the plant with the relative annual capacity; the production process for the types of MACSI listed; the methods of managing the storage of plastic raw materials and MACSI; and the procedures for keeping the industrial accounts of the plant.
• arrange for separate storage of virgin and recycled plastic materials, and of the types of MACSI, in the plant.
• file a quarterly plastic tax return.
• keep a daily accounting for the production plant.
• for each sale of MACSI made for delivery in Italy to other production plants or to economic operators who intend to request a refund of the tax, indicate separately in the invoice: the nature, quality, and quantity of the MACSI sold, the mass of virgin plastic contained therein, and the amount of tax paid or indication if it is an excluded MACSI.
• communicate an updated list of the sellers for which he/she carries out production activity, indicating the relevant identification codes;
• keep, in their accounts, an updated list of the plant operators which carry out the recycling processes of the plastic used in the production plant.

The seller is obliged to:

• file electronically a specific prior communication with the Customs Office. This communication must contain a technical report, listing the types of MACSI produced and indicating whether they are excluded, and indicating the annual quantity of MACSI which is expected to be produced in each of the plants.
• keep weekly accounts for each production plant.
• file the quarterly plastic tax return.
• for each sale of MACSI made for delivery in Italy to other production plants or to economic operators who intend to request a refund of the tax, indicate separately in the invoice: the nature, quality, and quantity of the MACSI sold, the mass of virgin plastic contained therein, and the amount of tax paid or indication if it is an excluded MACSI
• keep, in their accounts, an updated list of the plant operators which carry out the recycling processes of the plastic used in the production plant.

EU purchasers and EU sellers, the latter through their fiscal representative, are obliged to:

• file electronically a specific prior communication with the Customs Office. A technical report must be attached to the communication, containing a description of the procedures used to account for the MACSI purchased and sold along with the relevant invoices and accompanying documents. The report must also indicate the maximum quantity of MACSI that it intends to move in a year, specifying the types of MACSI and distinguishing between those subject to tax and those excluded, as well as their composition, with particular reference to the mass of virgin plastic material they contain. Where the purchaser is the owner of a MACSI storage facility, the communication must also include a description of the facility itself and its capacity, as well as the procedures by which the storage facility’s accounts are kept.
• file the quarterly plastic tax return.
• keep a daily accounting of the MACSI handled, distinguished by type, with separate accounting for MACSI subjected to tax, with an indication of the applicable rate on the basis of the certifications provided by the EU producer and the relevant purchase invoices, and excluded MACSI and those obtained exclusively from recycled plastic.
• keep the invoices for each MACSI purchase, distinguishing between subjected and excluded MACSI, bearing the relevant certification by a Community producer (e.g., on the quantity of virgin and recycled plastic material contained in the MACSI). For MACSI subject to the plastic tax and coming from countries outside the European Union, the tax is due by importers and is collected by the competent Customs Office at the time of importation, according to the procedures provided for border duties.

Importers should indicate in the customs declaration (DAU) the tariff classification code of the goods and carry out a self-assessment of the tax with reference to the quantity of MACSI declared.