Ontario consumers to pay new recycling fee on pop cans and other beverages starting April 1

Recycling system changes made by Doug Ford government allow new “pop can tax.” The itemized fee will likely be passed down to consumers from organization backed by Canada’s largest food and beverage companies.

Thestar.com
Feb. 10, 2023
Richard Warnica

An organization backed by some of the largest food and beverage companies in Canada is set to impose a new recycling fee on Ontario consumers, according to documents obtained by the Star -- a move made possible by a new recycling system introduced by Doug Ford’s provincial government.

Beginning April 1, shoppers across the province can expect to pay a new levy of between one cent and three cents per container every time they buy a non-alcoholic drink. The planned charges are part of a sweeping transformation of Ontario’s recycling system and come even as consumers are grappling with record food prices, high interest rates and crippling inflation.

“It’s a complete and utter ridiculous move. And frankly, some even question whether or not it should be allowed,” said Clarissa Morawski, a Canadian environmental consultant now working in Europe. “It’s a non-refundable fee. You can almost call it a tax.”

The Container Recycling Fee (CRF) is the brainchild of the Canadian Beverage Container Recycling Association (CBCRA), an industry-funded group that counts representatives of Coca-Cola, Tim Hortons and bottling giant Refresco, among others, on its board of directors.

The “pop can tax,” as one industry insider has dubbed it, will likely be applied by retailers at checkout and appear on receipts as a separate charge, like the HST.

The new levy comes eight years after the provincial Liberals finally abandoned a much-maligned plan to charge consumers similar “eco fees” on a much broader range of products. It’s part of a comprehensive overhaul of Ontario recycling policy that’s set to kick in later this year.

Under the old regime, municipalities were largely responsible for running their own recycling systems, with costs split 50/50 between municipalities and producers. Under the new arrangement, producers of packaged goods and other recyclable materials will be responsible for running and funding the whole show.

The “pop can tax” is one way non-alcoholic beverage producers plan to fund their share of the new system. The idea builds off a regime already in place in Manitoba. But critics argue it undermines the central premise of the new recycling plan.

“Why would you charge a visible fee to consumers?” said Morawski, who authored an overview of Canadian bottle recycling plans in 2020. “The whole point of this is that you, as a producer, start internalizing the costs that have been externalized for the last 70 years ... it’s a bit of a crock.”

CBCRA executive director Ken Friesen declined an interview request for this story. A spokesperson for the organization said in an email that all money raised by the levy will go back into the program and will be used to fund the collection, sorting and recycling of containers from both the blue box and public bins.

“The container recycling fee (CRF) is charged to beverage producers by CBCRA. Producers have discretion over how or if it is passed along to retailers, and retailers have discretion on how or whether to pass on to consumers,” said CBCRA spokesperson Sheri Moerkerk. “If producers and retailers follow what has been done in other provinces, then the CRF will be reflected on checkout receipts beginning April 1, 2023.”

The CBCRA also plans to install 250,000 recycling bins in municipal facilities across Ontario over the next five years and will launch a province-wide education and promotion program about the new system.

“Container recycling fees are a commonly used way to successfully fund the recycling of beverage containers no matter where they’re consumed,” Moerkerk said. “They are already being used in eight Canadian provinces and two territories where they have contributed to increased beverage container recovery rates.”

What a pop-can tax is not, though, is what many environmentalists and industry experts believe is the gold standard for recycling: a deposit return system where consumers can get their deposit back when they recycle containers. “In the absence of that, we’re basically just shuffling money around or shuffling the deck chairs on the Titanic,” said Karen Wirsig, the senior plastics program manager at Environmental Defence.

Deposit return systems create an economic incentive for consumers to collect and return as many containers as possible. They’ve been used in some jurisdictions to drive incredibly high recycling rates, including in Norway, where more than 92 per cent of single-use beverage containers were returned for recycling in 2021.

Ontario already has a deposit return system for alcoholic beverage containers, such as beer and wine bottles, via The Beer Store. Advocates would like to see that program extended to all drink containers. Deposit systems are just “way more effective,” Morawski said. “They directly affect littering. They put the responsibility smack back with the producers and the retailers and they’re proven to work.”

Under the CBCRA’s plan, consumers will begin paying a one-cent levy on aluminum cans, a two-cent levy on small PET plastic bottles and three cents on all other sealed, ready-to-drink non-alcoholic beverage containers in April. That includes everything from tetra packs to boxed water to steel cans of tomato juice.

Technically, it won’t be the CBCRA charging the levy. The organization will be billing producers who will have the option of passing their costs onto retailers who can then charge consumers. But in practice, in other jurisdictions, the end result has almost always been the same: a point-of-sale levy. And industry experts, as well as the CBCRA itself, expect the same thing to happen here.

“That’s the plan,” said one senior industry source, who has been briefed on the container-fee rollout. “There’s going to be a pop can tax in Ontario.”

The source, who was granted anonymity because he is not authorized by his employer to speak publicly, believes the container fees could undermine public support for the broader recycling overhaul.

“It amounts to a scheme to pass the cost of recycling on directly to the consumer,” he said. “And it’s politically obtuse ... I think consumers are going to lose their mind.”

There’s nothing in the new Ontario recycling regulation that prevents producer responsibility organizations, like the CBCRA, from imposing this kind of point-of-sale eco fee, Morawski said. That doesn’t mean the Ford government has explicitly approved this particular levy, just that it has created a system that makes them possible.

Gary Wheeler, a spokesperson for the Ontario ministry of the environment, said in a statement that the new recycling regulation is in the “implementation stage” and that producers and the organizations that represent them are making plans for how to manage collections.

He did not respond to a question about the new eco fees.