Law 7/2022, of April 8, on waste and contaminated soil for a circular economy (the Waste Law), published in the Official State Gazette of April 9, 2022, introduces tax measures to encourage the circular economy, including the creation of a special tax on non-reusable plastic packings (hereinafter, plastic tax), whose entry into force is scheduled for January 1, 2023.

This new tax will apply to the manufacture, importation or intra community operations of those products within the objective scope of the plastic tax.

Except for imports the tax must be self-assessed and declared by the company in a quarterly basis unless the company is obliged to file monthly VAT returns, in which case the plastic tax return is also to be filed monthly. For imports a reference to the amount of non-recycled plastic needs to be included in the Customs declaration so the plastic tax is liquidated along with the Customs duties and VAT by the Customs authorities.

Besides the previous registration in a specific census, other formal obligations need to be complied with by companies eligible the plastic tax, basically the mentioning of the plastic tax in its invoices by manufactures, the keeping of certain registers of `products and, for non-resident companies, the obligation to appoint a local qualified representative.

Additionally, those transactions which the Waste Law declares excluded or exempted from the tax are conditioned to the company being able to produce the corresponding evidence of its compliance with the required conditions, which in some cases will involve the obtention of a formal declaration from the client as to the destination to be given to the products it purchases.

For a more detailed summary of the Waste Law click here.