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The Rise and Fall of Single-Use Plastic Tax: The Effects on Sales and Prices

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  • Ater, Itai
  • Hodor, Michal
  • Yoseph, Nir

Abstract

We study the effects of an excise tax on single-use plastic tableware products introduced in Israel in November 2021 and repealed 15 months later. After the introduction of the tax, prices of taxed products increased by 45%, and sales decreased by 24%. After its repeal, prices dropped, and sales increased. Yet, prices were 18% higher and sales 19% lower than pre-tax levels. Our analysis shows that changes in consumption habits can explain 15% of the decrease in post-repeal sales, whereas the higher prices explain the rest. The change in consumption habits is greater among less price-sensitive consumers.

Suggested Citation

  • Ater, Itai & Hodor, Michal & Yoseph, Nir, 2025. "The Rise and Fall of Single-Use Plastic Tax: The Effects on Sales and Prices," CEPR Discussion Papers 20209, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:20209
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    File URL: https://cepr.org/publications/DP20209
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