New tax cutting sales of disposable utensils in half, stores say

The tax is levied by the state upon the manufacturers of plastic plates, bowls, cups, cutlery, serving dishes and straws, who then pass the price increase on to the stores.

Calculating taxes (photo credit: INGIMAGE)
Calculating taxes
(photo credit: INGIMAGE)

Less than a month since a new tax on disposable plasticware was imposed to aid environmental protection, sales on such items have been slashed by 50% or more, store owners say.

The legislation that came into effect at the beginning of November imposes a tax on disposable plastic utensils, including cups, plates, bowls, cutlery and straws, at a rate of NIS 11 per kilogram.

The goal of the tax is to cut plastic consumption, and it follows a study by the Environmental Protection Ministry that concluded that doubling the price to the consumer would reduce usage by about 40%. Just a few weeks after the tax took effect, it seems that it is working.

“Sales of disposable plastics in the past month have gone down by 50%-60%,” said Dubi Goldberg, manager of the Super Hamoshava grocery store in Jerusalem. “People are buying only what they absolutely need, and focusing more on biodegradable products that are not taxed.”

“It is definitely making a difference,” said Meni, manager of the Zol Ubegadol grocery branch on Hapalmah Street in the capital. Usually, we order new stock every week, but I have only made one order so far this month. Sales have fallen a lot.”

 A FREEZER with the Ben & Jerry’s logo at a store in Efrat. (credit: RONEN ZVULUN) A FREEZER with the Ben & Jerry’s logo at a store in Efrat. (credit: RONEN ZVULUN)

The tax is levied by the state on the manufacturers of plastic plates, bowls, cups, cutlery, serving dishes and straws, which pass the price increase on to the stores, explained Bezalel Duchanov, owner of Chagiga, which sells paper goods and party supplies. The stores are then forced to mark up their prices in response.

“Some people are waiting to see what happens before they stock up on more plasticware,” Duchanov said. “In our store, we haven’t seen a big change yet, because most of what we sell is paper or biodegradable. Only about 20% of what we sell is subject to the tax.”

Meni said that he negotiated a better rate with his suppliers about a week after the new prices were introduced. “They sent us a new price list, and I said, ‘We can’t work with these prices; they are too high,’ and they lowered it somewhat. I believe that is happening around the country.”

Meanwhile, haredi activists are still trying to overturn the tax, charging that it unfairly targets the ultra-Orthodox sector.

After a debate last week in the Knesset Finance Committee ended without a decision to cancel the tax, a group of haredi organizations wrote to Finance Minister Avigdor Liberman and committee head MK Alex Kushnir, charging that the tax ignores a number of important economic and social factors. If changes are not made, the matter will be escalated to the courts, they said.

Israeli consumers are among the world’s biggest users per capita of disposable plastics, and annual household consumption of these products is about 7.5 kg. per capita, five times more than in the European Union, the Environmental Protection Ministry has said.

In the last decade, the rate of consumption of disposable utensils in Israel has doubled. Now, Israelis throw away about 70,000 tons of plastics each year, and spend NIS 2 billion annually on these items.