The can and bottle recycling charge will be a tax: it must be run as one

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As the Guardian reports this morning:

All drinks containers in England, whether plastic, glass or metal, will be covered by a deposit return scheme, the government has announced.

The forthcoming scheme is intended to cut the litter polluting the land and sea by returning a small cash sum to consumers who return their bottles and cans.

This suggestion is obviously welcome but some questions need to be asked.

The first is who gets the non-refunded deposits? Surely not the retailer? This isn’t a scheme to increase corporate profits, is it?

Second, is the deposit going to be enough to change behaviour? If not, it will not work. 5p may have changed plastic bag behaviour but returning cans and bottles will require more effort: a higher charge will be needed.

Third, surely it will be compulsory? That is not clear at present.

Fourth, who will direct the use of the funds raised?

I ask because this is very clearly a tax. It is, admittedly an unusual tax because the aim will be that it collect minimum revenues, but that is exactly what tax on ‘bads’ should do.

But the point remains that to be effective this must be a charge imposed by government sanction on all retailers without exception with the revenues raised to go to public benefit and with the costs of its operation to be borne by an industry that ultimately sells an anti-social product.  The objective must be to quite deliberately  to change consumer behaviour.

In that case to make this look like anything but a compulsory, but avoidable, tax would be a big mistake. The government must create and enforce  this scheme. It must also make clear tax is being used for a strong social purpose. And it must take the plaudits for doing so. There is a Joy of Tax, after all. One such joy is it can deliver good things. This is one of them.