Belfast Telegraph

Store loses plastic bag levy battle

Retailers and consumers could be hit in the pocket after Dunnes Stores lost a multimillion-euro legal challenge against the plastic bag levy.

The High Court ordered the supermarket chain to pay a 36.5 million euro tax bill owed to the Revenue Commissioners.

Stephen Lynam, director of Retail Ireland, fears the ruling that the levy is not limited to bags supplied at the point of sale could have serious implications.

He said the plastic bag levy was introduced to encourage shoppers to recycle plastic bags. "You cannot reuse a bag that is used to store meat," he added. "This could have implications for retailers and consumers."

The dispute centred on whether the environmental levy applied to plastic bags supplied in stores for hygiene purposes - used to wrap fish, meat and carry fruit and veg in - as opposed to standard carrier bags sold at check-outs and used to carry groceries home.

Dunnes Stores challenged a multimillion-euro tax bill after Revenue served it with tax assessments covering 2004 to 2008.

It argued the tax assessments were an unlawful attempt to apply the levy to flimsy plastic bags supplied for the purpose of wrapping goods and supplied otherwise than at the point of sale. It also claimed the Revenue commissioners had refused to provide how it calculated the money that was allegedly due.

But Mr Justice John Hedigan ruled against the supermarket chain on all points and found the levy was not limited to carrier bags. He maintained the intent of the provision was to reduce as much as possible the presence of discarded plastic bags littering towns and countryside.

Guidance on Revenue's website confirms certain bags are excluded, including those used solely to contain fresh meat, fish, ice, poultry and used solely to contain loose fruit and vegetables. The retailer is also obliged to pass on the levy to the customer.

Green Party environment spokesman Malcolm Noonan called on Environment Minister Phil Hogan to clarify the position on the levy. "While welcoming any judgment that leads to a reduction of plastics and toxins in the environment, I do think that clarification is required," he added.


From Belfast Telegraph