Wednesday 22 May, 2019

Gov't to suspend import tax on eco-friendly packaging

Government said biodegradable and eco-friendly packaging for the food and beverage industry will be exempt from customs duties for a two-year period, starting from 2019. 

The move coincides with the decision to ban the importation and use of Styrofoam packaging in 2019, which was announced in July 2018. Up to March 13, 2019, no date was set for the implementation of the ban.

Minister in the Ministry of Finance, Allyson West, standing in for Minister of Planning and Development, Camille Robinson-Regis, said the decision was made at a Cabinet meeting, and that the requisite Harmonised System (HS) codes for the Customs and Excise Division are currently being finalised, following which the ban would be implemented.

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“Cabinet, at its meeting held on June 21, 2018, agreed inter alia...that the importation of the finished expanded polystyrene products for the food and beverage sector should be banned.

"(Cabinet also agreed) to the removal for the period of two years in the first instance, of customs duty on the importation of the alternative biodegradable products listed (such as) bioplastics, polylactic acid, crystallised polylactide, polyaldo 8, and bagasse...(and) that the Ministry of Trade and Industry should provide HS codes with respect to the above."

West said the Ministry of the Attorney General and Legal Affairs, in collaboration with the Ministry of Trade and Industry and the Ministry of Finance, were also instructed to take the necessary action to give legal effect to those measures. 

West said local manufacturers and importers of Styrofoam products should also explore the viability of using environmentally friendly materials in their products. 

The local manufacturers of EPS products (should) explore the addition of safe biodegradable and safe additives to the existing process with production trials to commence in the last quarter of 2019.”

She said the Ministry of the Attorney General, the Ministry of Trade and the Ministry of Finance have developed a legal framework for the ban with includes the HS codes.

“Upon completion of the legislative framework the ban on the importation of finished EPS products for the food and beverage sector will be placed in effect.”

“It is to be noted that the Ministry of Trade and Industry has also advised that notice of the intention to introduce this measure was provided to the Council of Trade and Economic Development of the Caribbean Community in November 2018," West said. 

She said a meeting was held in February 2019 to discuss the way forward to effect the Cabinet’s decision in the shortest possible time.

She said it was agreed that the Customs and Excise Division would present the finalised Customs codes for the approved products to the Ministry of Trade and Industry.

Upon the receipt of the codes, the Ministry of Trade and Industry would provide notification to the relevant international organisations within 20 days.

She said the Customs and Excise Division is in the process of determining the Customs codes for these products and has requested further literature from the Ministry of Planning and Development, which are being compiled for submission.

She said it was also agreed at the meeting that upon the advice of the Minister of Trade and Industry, a prohibition order would be engaged to effect a ban on Styrofoam.

“It was agreed that this would be communicated to the Office of the Attorney General by the Ministry of Trade and Industry,” she said.

West said there was no timeline for the process but said the ban would take effect once these measures were completed.

West said a steering committee was established to engage with stakeholders on the proposed Styrofoam ban.

The committee was told that the Styrofoam industry employs just over 400 people and has a value of close to $30 million.

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