WASTE VALUE TAX: A proposal for creating a new waste management model

30.09.2019 News

By: Vita Jaunzeme

Chairwoman of the Board, NGO “Pēdas LV”

Vita.jaunzeme@pedas.lv, +371 29909222

 

9 July 2019, Riga, Latvia

In Latvia, used packaging deposition system allowing consumers to return used packaging in reverse vending machines is not yet in place, therefore, a significant part of recyclable waste ends up in landfills or in environment (as proven by the Gateway & Partners research – Industrial impact research within the deposition system implementation in Latvia). However, in informal consultations with our partners in the neighbouring Estonia and Lithuania, where reverse vending machines have been part of the waste management system for a couple of years, used packaging deposition system does not solve the environmental pollution problem. In order to tackle the root of the problem, we need a different waste management system and a much higher level of public awareness on environmental issues. Sweden has achieved very good results by introducing a well-functioning waste sorting system, including a packaging deposition system, in combination with appropriate legislation and a long-term education of the Swedish society. Latvia does not have time to achieve the same level of efficiency as in Sweden by introducing the same model of waste management – with the current growing speed of global (and national) pollution we must find faster and more efficient ways to tackle the waste problem.

Currently, the most acute problems in Latvia are:

  • ineffective resource recycling has a significant negative effect on the consumption of natural resources, stimulating the overall degradation of the planet;
  • visible and invisible environmental pollution – micro-particles of plastic and poisonous substances accumulating in the air, soil and water;
  • decrease of the quality of drinking water and food, affecting health of humans and other living species;
  • Visible effects of the global climate change.

Educating society is still a priority – information campaigns, education programmes and events, clean-ups, public debates, etc. However, introducing efficient practical steps for the sanitation of the environment and the improvement of the quality of drinking water and food is our goal. Therefore, we, the Latvian environmental movement Lielā talka (Big Clean-up) propose an idea for a new waste management system that could eliminate public “interest” to dispose of their waste in environment.

Waste value tax

Currently, the worst situation is in the household waste segment due to inefficient waste management model and lack of control mechanisms. To save money on waste collection services, inhabitants often dispose of their household waste themselves by dumping it in nature, burying or burning it.

Individuals and companies often choose the cheapest waste management services, which do not always include proper supervision and control of the contract fulfilment. For instance, a household orders the cheapest waste collection service with the lowest waste volume plan, disposing of the rest of the generated waste illegally (dumping it in forest or burning it). This problem is also common among companies, and is very difficult to control.

In apartment blocks, there is a level of inequality embedded in the current waste collection model. In calculating the cost for waste collection, the total volume of waste is equally divided among all inhabitants of the house or the entire block of houses. This means that people who generate more waste pay a cheaper price for their waste collection than those who produce less waste (usually those with a lower purchasing power, like seniors and poor families).

The idea of a waste value tax (WVT) is to include the cost of waste management into the price of goods, with different grades / levels depending on the type of product and its packaging. The implementation of the proposed WVT system would meet the equality principle: the one who consumes, pays. The WVT idea can be implemented in combination with various waste collection, sorting or depositing systems.

The advantages of the proposed WVT model:

  • All packaging and other waste generated in the market would be collected and managed legally;
  • Minimise illegal waste collection and landfilling;
  • Minimise the need for households and individuals to dump waste in environment (some problems might occur in camping sites, but the annual clean-up campaigns would deal with that);
  • principle of fairness would be implemented – the more I consume, the more I pay for waste management;
  • increase of unpackaged goods in the market, more use of degradable / ecological materials in the production of goods and packaging;
  • Financial benefits for waste management companies, providing a long-term and foreseeable business development, and fostering innovation.

How the proposed WVT model would work:

Upon purchasing goods, consumers would already be paying for the collection and management of the disposed items and packaging. This means that the WVT revenues would cover the costs for collecting, sorting, recycling and landfilling of waste. The revenues from the WVT would be centrally distributed to local governments responsible for coordinating waste management in their territories by contracting certified companies. The WVT would work as a public investment fund for creating an efficient, user-friendly and sustainable waste management system.

Implementation models

There are many aspects to the proposed model, which need further development – from balancing waste management costs with product prices, eventual inflation, upgrading or introducing different forms of deposit, etc… Therefore, involvement of national and local governments, manufacturers and waste management operators is crucial in creating a viable and efficient waste management model. We encourage all parties interested in the WVT idea to contribute to the development of a new waste management model with their practical solutions and to create a truly efficient and financially viable WVT implementation model eventually.