According to information from eight industry associations, the plastic tax is expected to be introduced as an amendment to the ongoing procedure for the Budget Support Act 2027 in the short term – without the involvement of the technically responsible federal ministries and without the cabinet’s approval of the specific text of the law. In a document dated October 2, 2026, sent to Federal Chancellor Nina Warken directed urgent letter The associations, including the BDE Federal Association of the German Waste Management, Water and Recycling Industry, the Federal Association of the German Food Industry, the German Trade Association, the IK Industrial Association for Plastic Packaging, the Brand Association, Plastics Europe Germany and the VDMA, demand an independent and transparent legislative process.
„A new consumption tax of this magnitude must not be decided in haste in the shadow of the budgetary procedure,“ the associations write in their letter to the Chancellery. They ask the Chancellery chief „to stop the proposed expedited procedure and – should the Federal Government stick to the project – to ensure an independent, transparent and results-oriented legislative procedure.“.
According to the associations, the Federal Ministry of Finance intends to provide the Budget Committee of the Bundestag with guidance on how to introduce the new consumption tax. They point out that there is no precedent for introducing a completely new consumption tax law in this way. Previous consumption taxes have always been dealt with in separate legislative processes.
According to the associations, the cabinet decision does not cover a tax plan
On July 6, 2026, the Federal Cabinet approved the draft federal budget for 2027 and the draft accompanying budget law for 2027. The financial plan therefore includes the political determination to permanently generate revenue from a consumption tax on plastic packaging equivalent to Germany’s EU contribution to the EU’s plastic fund. According to the associations, the draft budget includes a negative title for the transfer to the EU of 1.261 billion euros, but no corresponding revenue title.
However, the key elements of such a tax were not included in the cabinet decision – such as the subject matter of the tax, the taxpayer, the basis of assessment, the tariff, the exemptions, the treatment of imports, and the collection, verification, and control procedures. Also lacking were reliable data on the workload of the customs administration and the compliance burden of the business sector. Therefore, in the view of the associations, the cabinet decision cannot be understood as an approval of a specific plastic tax law, but merely as a determination of an income target.
Associations expect high costs for bureaucracy and implementation
A research project by the Federal Environment Agency (UBA-Texts 87/2025) has already calculated the bureaucratic costs for a general packaging tax at around 420 million euros annually, although only 1.5 person-days per affected company were allocated. Costs for tax advice, auditing, IT adaptations, and legal advice are not included in this figure. Taking all costs into account, the associations estimate that a tax on plastic packaging would result in corporate-level bureaucratic costs of at least 600 million euros annually – an estimate based on the UBA calculations, which are to be reviewed in the legislative process through an independent workload assessment.
In addition, there is a significant personnel and IT effort for the federal customs administration. According to the associations, around 2,000 additional customs officers would be needed depending on the definition of the tax debtor group for registration, tax supervision, operational audits, appeals, and import controls. A reliable personnel needs calculation is however not possible without knowledge of the tax debtor group, the registration procedures, the inspection duties, and IT support.
Dr. Christine Bunte, Chief Executive Officer of Plastics Europe Germany, said that the planned plastic tax threatened to become a national tax experiment. There were currently no reliable findings regarding taxpayers, enforcement, bureaucratic costs, and the actual revenue for the state. Anyone introducing a new consumption tax with a billion-dollar impact would first need to know whether it would actually work. Such a decision should not be made in a rushed manner.
Federal Environmental Agency warns of ecological mismanagement
The Federal Environmental Agency explicitly warns in its research project against solely increasing the price of plastic packaging. Such taxation could trigger significant shifts in preferences towards other packaging materials that, when viewed from the entire life cycle, are not ecologically better and in certain applications even worse. In particular, there is a threat of a shift towards heavier packaging or materials that are poorly recyclable, such as plastic-coated paper packaging.
Dr. Martin Engelmann, Chief Executive Officer of the IK Industry Association for Plastic Packaging, described the plastic tax as a smokescreen. It is a purely fiscal measure, which the Federal Environment Agency had also warned against, as a unilateral burden on plastic packaging would lead to heavier and less recyclable alternatives. Engelmann called on the Federal Government to present instead a proposal for the financial incentives provided for in the coalition agreement for well-recyclable packaging with a recycled content. For German companies that rely on such packaging, the lack of corresponding incentives is now a competitive disadvantage because they cannot compensate for their research and development costs.
As an alternative, the associations refer to the eco-modulation of license fees for packaging provided for in the coalition agreement. Instead of uniformly increasing the cost of plastic packaging and thereby triggering material substitutions with potentially worse environmental impact, ecologically modulated license fees could be based on the material capacity of a packaging to be recycled and the use of recycled material. The associations demand that a drafting assistance for the plastic tax be submitted to the Bundestag only after a complete legislative proposal is available, the technically concerned ministries have been involved, the economic and environmental consequences have been examined with the National Council for Normative Control, and the Federal Cabinet has decided on the specific text of the law.
Source: IK Industrial Association
