New U.S. & UK Tax Regulations Impacting Toymakers

May 9, 2022 | The Toy Association is alerting members to new tax updates that will impact companies conducting business in the U.S. and the UK.

U.S. Brings Back Superfund Tax

The Infrastructure Investment and Jobs Act, passed last November, has resurrected ­— and doubled — a superfund tax (originally part of the Comprehensive Environmental Response, Compensation, and Liability Act (CERLA) of 1980) on certain chemicals that are considered to have a heightened risk of environmental contamination.

The tax will impact manufacturers, producers, and importers of the listed chemicals or articles containing one or more of the listed chemicals at more than 20% by weight or value each. Many are commonly used plastics, surfactants, and other chemicals which may be present in toys.

Taking effect on July 1, tax amounts will vary by chemical and will be assessed by weight of chemical imported. All businesses are responsible for compliance beginning with their Q3 2022 quarterly tax filings due October 31, 2022. The funds generated are expected to be used to address potential environmental response and remediation.

UK Plastic Packaging Tax Now in Effect

The UK’s Plastic Packaging tax took effect April 1 and applies to all manufacturers and importers with plastic packaging and packaging components that contain less than 30 percent of recycled plastic.

If your business has manufactured or imported 10 or more tonnes (metric tons) of finished plastic packaging components within the last 12 months, or will do so in the next 30 days, it is now required to register for the Plastic Packaging Tax.

While this tax is not specific to toys, it does impact toy manufacturers in and importers into the UK.

More information can be found here.

For additional guidance on these new regulations, how to comply, and how these taxes may impact your business operations, contact The Toy Association’s Alan Kaufman, senior vice president of technical affairs.