A new analysis suggests that Labour's contested 'grocery tax', formally known as Extended Producer Responsibility (EPR), could add up to £56 annually to UK households' shopping bills. The policy, aimed at meeting net-zero targets by requiring retailers and manufacturers to cover packaging waste collection and disposal costs, is facing backlash for potentially raising food prices and burdening businesses with additional bureaucracy. While the Government argues EPR will incentivize environmentally friendly practices, opponents fear these extra costs will ultimately be passed onto consumers.
A new analysis has laid bare the potential impact of Labour's contested " grocery tax " on UK households, suggesting it could add as much as £56 annually to shopping bills and cost families approximately £1.4 billion a year. The policy, aimed at meeting net-zero targets , is facing backlash for potentially raising food prices and burdening businesses with additional bureaucracy while promising taxpayer relief.
The Government anticipates that between 85% and 100% of the levy's costs will be reflected in consumer prices, but retailers, including the British Retail Consortium , caution that these figures likely fall short of actual costs, with business impacts possibly topping £2 billion annually. He remarked: "It heaps more than a billion pounds of new and unnecessary costs on consumers", and highlighted that such actions worsen inflation and hinder economic growth. The policy emerges during a period of escalating food prices, with inflation climbing for the second month in a row following Rachel Reeves's Budget.
Andrew Opie of the BRC has stated that while the policy could play an important role in reducing unnecessary packaging, it needs to deliver tangible environmental benefits to justify its £2 billion price tag. Lord Frost, the UK's former Brexit negotiator, has accused Labour of imposing excessive green regulations that hurt families and businesses.
Labour Party UK Politics Extended Producer Responsibility Grocery Tax Net-Zero Targets
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