Next steps for deposit return schemes
Executive summary
- AAT Licensed Accountants provide tax and accountancy services to approximately 500,000 small businesses in the UK, including many newsagents and small retailers. A deposit return scheme could have a significant impact on small newsagents and the like due to a lack of storage space and similarly if significant numbers of cans and bottles are returned, this could potentially impact the effective running of their business given queues and the time taken to deal with returned items. However, it could also lead to increased business through increased footfall and the handling fee would represent an extra revenue stream.
- "All in" or "on the go": AAT recognises merits in both of these approaches but in the interests of simplicity, user convenience and the overall effectiveness of a deposit return, believes that an "all in" approach is the best option.
- Level and scale of deposit charges: Whether the deposit should be a flat rate or variable is a difficult question. International evidence on this is mixed with some countries opting for a single deposit irrespective of size and others opting for a differential.
- Impact on local authorities: Many of the items subject to a deposit return scheme currently represent an income stream for local authorities. That said, some of this is actually residual waste, non-hazardous material that cannot be re-used or recycled and needs to be sent to energy recovery or disposal (at considerable cost to local authorities). There is also the likely reduction in littering, and consequent savings for local authorities, to consider.
- Scotland: AAT notes that some critics have suggested the decision to proceed with a scheme in Scotland two years before such a scheme becomes operational in England, Wales and Northern Ireland is problematic and that a two-tier system is undesirable. However, in reality this situation presents a solid learning opportunity for the rest of the UK, whereby any particularly successful or unsuccessful aspects of the Scottish scheme can be factored into the operation of the scheme in England, Wales, and Northern Ireland.
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