Shopping bills will increase as green levies will raise food prices by £4bn

Green levies will raise food prices by £4billion after they arrive next year, warn retailers.

The British Retail Consortium says the scheme to charge shops and manufacturers to meet council costs of recycling packaging will send the price of household goods spiralling from April.

The levy was devised by Michael Gove while environment secretary and was billed as helping to cut waste and meet net zero.

Alongside it will be new returnable deposits on drinks bottles and cans.

Together, the schemes could boost shopping bills by up to £140 per year for each household, based on the BRC’s estimate of an overall £4billion cost.

Officials say the funds raised will improve council recycling and will encourage less packaging.

But they have acknowledged that the entire cost could simply be passed on to consumers. The packaging scheme, called extended producer responsibility, in February last year was estimated to increase household bills by up to £48 annually but that was before soaring inflation.

The separate “deposit return scheme” will add up to 4p to the cost of bottled drinks, another report stated. It seeks to give incentives to recycle containers.

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Former Tory minister Lord Frost said: “It makes no sense.”

He added: “In a cost of living crisis, what people absolutely do not need is for food prices to go up because we are putting more unnecessary costs on business with the spurious justification of net zero.”

Craig Mackinlay, who chairs the Net Zero Scrutiny Group of Tory MPs, added: “If we want hard-pressed families to manage the cost of living crisis, this grocery tax needs to be abolished.”

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