Your packaging budget for FY 2027-28: the cost lines that change on 1 April 2027

The usual way to budget packaging is last year's spend plus a percentage for price rises. For FY 2027-28 that method will miss several lines.

They change by rule on 1 April 2027, whatever happens to resin or paper prices.

Here is the short version. In India, the recycled plastic that obligated brand owners, producers and importers must use doubles for flexible and multilayer packaging, and rises from 40% to 50% for rigid. The share of the EPR target that must come from recycling rises as well. In the UK, the Plastic Packaging Tax goes up to £236.56 a tonne, and red-rated packaging pays 1.6 times the household EPR fee.

GST on packaging does not change.

Checked against official sources on 28 October 2026.

I will keep to what has been published. I will not forecast resin prices or guess at courier rises. Where a number is not out yet, I say so and tell you where it will appear.

We make tapes, films, bags and paper packaging in Jaipur, so these rules sit close to our own work. I run a packaging factory. I am not your tax adviser, so treat this as a map and take each line to your accountant.

Which packaging costs change on 1 April 2027?

Three more lines run all year without a 1 April date. EU consumer parcels pay a €2 handling fee per item, plus €3 duty per item on parcels up to €150 until 1 July 2028. US parcels have no duty-free value, and the law ends de minimis for good on 1 July 2027. And the US carriers raise rates in December and January.

How much does the recycled-plastic step-up add?

The method is tonnes, then share, then premium. We use the same order for every category.

Take your flexible (Category II) packaging. If you used 50 tonnes in FY 2026-27, the rules asked for 10% recycled plastic, i.e. 5 tonnes. In FY 2027-28, at the same volume, they ask for 20%, i.e. 10 tonnes. The extra 5 tonnes, multiplied by what recycled plastic costs you over virgin per kg, is the new budget line.

Multilayer works the same way, but on the weight of the plastic layers only. Rigid moves by 10 points, so 50 tonnes of rigid packs needs 25 tonnes of recycled plastic instead of 20.

I will not give you a recycled-plastic premium.

It depends on the grade, the colour and the supplier, and any number I printed would be wrong for most readers. Ask your film and bag suppliers for two quotes per SKU, one virgin and one recycled. Our guide on recycled content versus environmental compensation shows how to turn those two quotes into a premium per kg and test it against the compensation.

One caution for smaller firms. Micro and small brand owners are outside the EPR obligations, but micro and small producers still owe the recycled share themselves. Since 1 April 2025, "small" means investment up to ₹25 crore and turnover up to ₹100 crore. Check your own Udyam classification before you budget either way.

What about EPR certificates, the annual return and the risk reserve?

The EPR target itself stays at 100% of your average tonnes. What changes is how much of it must come from recycling: 80% for rigid, and 60% for flexible and multilayer, in FY 2027-28. Ask your EPR partner to quote recycling certificates and end-of-life certificates separately, because the mix you need is moving.

Budget people's time too. Under the rules, the annual return for FY 2026-27 is due on 30 June 2027. For FY 2025-26 the Ministry extended the date to 31 December 2026, in an office memorandum published on the CPCB portal. Nothing has been said about next year.

So plan for June.

Then keep a reserve. CPCB's EC guideline charges ₹2,900, ₹5,000 or ₹7,900 per tonne of shortfall by category, twice that for a second default and three times for a third. A reserve line is not permission to fall short. It is what a careful finance team keeps for the gap between plan and actual.

Does GST on packaging change in 2027?

No change has been made or recommended for the main packaging codes. The rates set from 22 September 2025 by Notification 9/2025-Integrated Tax (Rate) still apply:

1. 5% on cartons, boxes and cases of corrugated or plain paper and paperboard (4819 10 and 4819 20), paper sacks and bags, and moulded pulp trays.
2. 18% on self-adhesive plastic tapes (3919), plastic film (3920), plastic bags, sacks and closures (3923), paper labels (4821), uncoated kraft paper (4804) and coated papers (4810, 4811).

Here is a practical point that is easy to miss. If you claim input tax credit, compare quotes before GST. If you cannot claim it (an unregistered business, or one under the composition scheme), compare them after GST, because a plastic mailer at 18% and a paper carton at 5% start 13 points apart.

The 57th GST Council of 8 October 2026 also recommended a few changes with 2027 dates. They are recommendations, not law, until they are notified or passed in the Finance Act. I would keep them as notes, not budget lines.

1. Refund of accumulated input tax credit on capital goods, for zero-rated and inverted-duty cases, spread over 60 months, for credit taken on or after 1 April 2027. This matters if you are buying packaging machinery.
2. Plastic waste and scrap under reverse charge when a registered person buys it from an unregistered one, with 2% TDS on B2B scrap supplies. This touches recyclers first.
3. A new way to amend liability and credit in returns, starting from the return for April 2027.

If you export or sell abroad

1. UK importers of your plastic packaging pay about 23.7p per kg on components under 30% recycled, and pre-consumer recycled plastic stops counting from 1 April 2027. Our UK Plastic Packaging Tax guide has the worksheet.
2. Under UK packaging EPR, red-rated household packaging pays 1.6 times the base household disposal fee in 2027-28, against 1.2 times in 2026-27. Amber pays the base fee, and green gets a discount funded by the red surcharge, as per PackUK's modulation statement. The 2027-28 fee rates had not been published on 28 October 2026. If the base fee stayed the same, a red pack's household fee would rise by a third, because 1.6 ÷ 1.2 = 1.33. UK buyers now have a clear reason to ask for packs that rate better.
3. EU consumer parcels up to €150 pay €3 duty and €2 handling fee per item for the whole financial year. See our guide to EU and US parcel costs in 2027.
4. US parcels have no duty-free value left, and UPS and FedEx raise rates by an average 5.9% (as reported). See our US courier guide for 2027.

The budget sheet

Keep one column for FY 2026-27 actuals next to each FY 2027-28 estimate. The difference, line by line, is what you explain to your owners.

For the freight line on Indian domestic orders, nothing has been published for 2027 by rule. Re-rate on your current contract. Our guide to reading a courier rate card shows where each of your parcels sits against the slab lines.

A calendar for the next twelve months

1. November 2026: PackUK plans to calculate final 2026-27 fees and issue notices of liability.
2. 21 December 2026: UPS 2027 rates start (reported), and the UK consultation on mass balance closes.
3. January 2027: FedEx rates from 4 January and its paper document fee from 18 January (both reported). USPS temporary prices end on 17 January.
4. 1 February 2027 (expected, not announced): Union Budget.
5. February and March 2027: collect recycled-plastic declarations from every supplier, SKU by SKU.
6. 1 April 2027: India's recycled-plastic and recycling-share step-up, the UK tax rate and pre-consumer rule, and the UK EPR multiplier of 1.6.
7. 30 June 2027: EPR annual return for FY 2026-27 (the rule date).
8. 1 July 2027: US de minimis ends in statute.
9. By 1 December 2027: the EU decides what happens to the €3 duty after July 2028.

If you do one thing before the Diwali holidays, sort the last twelve months of packaging purchases into the plastic categories, in tonnes. Every Indian line above starts from that one number.

This guide explains the rules as published on 28 October 2026. It is not legal or tax advice, so confirm each line with your accountant or compliance advisor before you lock the budget.