Published by Zero Waste Europe, 29.10.2026
The EU uses around 55 million tonnes of plastic a year, or 105 kg per person. Limiting global warming will require significant reduction in plastic consumption. On a business-as-usual path, plastic would emit a total of 7 Gt CO2e per year by 2050, and this sector alone would use up around a third of the entire 1.5°C budget.
If the forthcoming EU Circular Economy Act is any indication, bloc-wide measures to curb virgin material use are not on the horizon. But EU Member States mustn’t wait for EU-wide measures and act within their own right on material taxation. Our new policy brief, The circular leverage: Could a Dutch fossil plastics tax serve as Europe’s circular blueprint? presents a concrete idea proposed in the Netherlands that is worth the attention of policymakers across the continent.
Virgin fossil-based plastic is cheap, and that is why it became a driver of short-lived uses like single-use packaging and fast fashion. Recycled and bio-based alternatives struggle to compete: bio-based resins typically cost 1.5 to 2 times more than their fossil counterparts. Circular business models such as reuse, repair, and remanufacturing are often labour-intensive and therefore heavily taxed.
Supply-side fixes alone can’t close the price gap between virgin fossil-derived plastics and other materials, or circular business models. In the Netherlands, the Plastic Tafel, a consortium of industry, recyclers, producer responsibility organisations and civil society, has proposed ‘de circulaire hefboom’, or ‘circular leverage’: a tax on the proportion of virgin fossil-based plastic in a product. The more virgin fossil plastic a product contains, the higher the levy. Products made with recycled or bio-based material, or systems designed around reuse, repair and sharing, pay less.
The revenues would flow into a transition fund for the circular economy, backing innovation, better-quality recyclate and the businesses that keep materials in use. As more companies switch, the fund shrinks and eventually disappears. And because the tax applies to everything placed on the Dutch market, domestic producers aren’t put at a disadvantage against foreign ones.
How would the levy know what’s inside a product? Through the EU’s Digital Product Passport, which could give regulators reliable, standardised data on material content. The brief works through a hypothetical example for textiles, showing how a levy would apply.
The proposal hasn’t been tested in real market conditions, and our briefing also digs into the risks and points of attention. Among others:
The Digital Product Passport will arrive product group by product group, and it isn’t foreseen for packaging, a major plastic-consuming sector (35% of plastics in the EU).
By using the mass-balance method, products can claim to have more recycled content than is actually present in the product. This leads not only to false claims, but would also be a way to avoid taxation.
Swapping fossil plastic for bio-based material without safeguards risks new pressure on land and a muddling of circular and bio-based concepts.
Revenues must support reuse, repair and prevention, not merely recycling.
The levy must be tied to the environmental goal of reducing plastics consumption to return to the 1.5°C target. Not just to closing the price gap with recycled material.
“If it works, the circular leverage could become a blueprint for other countries and the EU as a whole. Coordinated action could pave the way for a harmonised EU-wide plastic tax, avoid fragmenting the Single Market, and extend to other virgin materials” - Rob Buurman, Fair Resource Foundation
Pricing virgin material consumption is the missing piece in the EU’s circular economy framework. Recycled content targets, public procurement, and Extended Producer Responsibility all matter, but they lack teeth as long as primary material use remains too cheap.
The policy briefing sets out six concrete recommendations for policymakers to make this shift happen.
Read the full briefing here.
