The REDUCE Act of 2023 establishes a federal excise tax on virgin plastic and imported plastic products to reduce plastic waste and fund recycling infrastructure. Beginning January 1, 2024, the tax starts at 10 cents per pound of virgin plastic resin, increasing to 15 cents in 2025 and 20 cents in 2026, with automatic adjustments for inflation thereafter; imported single-use plastic items like beverage containers, bags, and food service products face a flat 20-cent-per-pound tax. The legislation exempts small manufacturers and producers that produce fewer than 10 tons of plastic annually and excludes certain medical and health products from taxation. Revenue generated by the tax goes into a new Plastic Waste Reduction Fund, which provides funding for recycling infrastructure improvements, reuse and refill systems, marine debris cleanup, and environmental justice initiatives related to plastic pollution. The law prohibits the fund from supporting waste incineration, energy recovery from plastic waste, or conversion of plastic into alternative fuels or chemicals.
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