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Businesses in the South West have raised concerns a new tax on packaging could force them to raise prices.

The government introduced Extended Producer Responsibility (EPR) this month which required firms to cover the cost for collecting, recycling and disposing of packaging it produces, with the money going to councils which collected the waste.

Owners of businesses have criticised the tax which some described as “complicated” and could lead to customers having to pay more.

The Department for Environment, Food and Rural Affairs (Defra) said EPR would move the cost of dealing with the waste away from taxpayers and generate more then £1bn for councils to improve recycling collections.

Sam Lindo from Camel Valley Vineyard, based near Bodmin, said the winemaker could process up to 4,000 bottles a day.

He said his main issue with EPR was the additional “bureaucracy” it brought.

“It’s incredibly complicated because it’s not just the different types of packaging, it’s whether it goes to household, non-household, branded, unbranded,” Mr Lindo said.

“My spreadsheet matrix is enormous.”

Joe Healey, managing director for trading at Healey’s Cyder near Truro, said he was concerned about the impact EPR could have on prices for customers.

“It is a new tax on manufacturing which is directly linked, in my view, to the currently high inflation on food and drink at supermarkets,” he said.

Caroline Voaden, Liberal Democrat MP for South Devon, said a businesses in her constituency were also worried about EPR.

“The New Inn, a historic pub in my constituency, has been informed by the brewery that supplies it that prices will increase by 7p per bottle of beer and cider and by 21p per bottle of wine,” she said.

“But the brewery won’t deal with the bottles afterwards, so they also have to pay for the disposal of the glassware.”

Defra said EPR underpinned “major investment” in the UK economy and would help create 25,000 jobs.

It said it had worked with businesses to ensure they were prepared for EPR’s introduction and would continue to listen to trade and industry bodies.

“Extended Producer Responsibility moves the cost of dealing with waste away from taxpayers and generate over a £1bn annually that must be spent by councils to improve recycling collections and thereby benefit every household across England,” a spokesperson said.