Under the new draft Packaging Act, the state plans to abolish the excise duty, introduced in 1997, saying it has outlived its usefulness.

The duty has been paid by companies that put packaged goods on the market but have not collected and recycled sufficient packaging waste. It is planned to scrap the tax from July 1, 2027.

In recent years, the state has earned around €300,000 a year from the excise duty. However, Minister of Infrastructure Kuldar Leis (Reform) said revenue from the duty has declined significantly over the years.

"As time has passed and the recycling targets are being met, and on the other hand, only smaller companies are left that have to pay or have paid the duty, there is no longer any point in collecting the packaging excise duty in this form," he said.

Abolishing the tax will not exempt companies from collecting and recycling packaging waste in the future. This obligation also stems from the new waste reform.

"The plan is to transpose the European Union's Packaging Regulation, and the broader goal there is to reduce all kinds of waste generation, particularly packaging waste, and to recycle more packaging," Leis said.

The Estonian Chamber of Agriculture and Commerce supports abolishing the tax as this will reduce producers' obligations.

The organization is also satisfied with a clause in the draft which means companies who place less than 100 tons of packaging on the Estonian market annually will no longer have to submit packaging reports

Until now, the threshold has been 20 tons, said Meeli Lindsaar, the chamber's head of food policy.

"This obligation will remain, but it will apply to those companies whose packaging recycling volumes are significantly larger and whose share of the overall recycling volume is certainly greater," she said.

However, the chamber is concerned about the new EU rules, under which companies will have to give more detailed breakdowns on exactly what type of packaging they use and what they contain, Lindsaar pointed out.

"Here, we are not just distinguishing whether the packaging is made of cardboard, plastic or metal, but within all these groups, it must be specified very precisely what material, what composition, for example, the plastic packaging is made of. But it is not possible to assess this with certainty and know at all times that it is exactly the same. At the same time, industry must declare very precisely all the packaging it receives and what kind of packaging the product is then sent out in," she explained.

Lindsaar added that the idea is understandable from the perspective of packaging recycling, but for industry and producers it represents a major additional burden.

Leis said cooperation with business organizations is ongoing and the current content of the draft may still be refined.

"The broader aim is still to continuously encourage us to waste as little packaging as possible and to recycle more," the minister said.

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