The announcement comes after MPs called for a 25p "latte levy" on disposable coffee cups.
"The revenue should be used to invest in reprocessing facilities and 'binfrastructure" to ensure that the remaining disposable cups are recycled'.
Mary Creagh, the chair of House of Commons' environment committee, said the British government had "sat on its hands" over the tide of takeaway drinks cups, with half a million littered every day: "We urge the government to introduce a 25p charge on disposable cups".
David Palmer-Jones, Chief Executive Officer of SUEZ recycling and recovery United Kingdom said: "Taxes on takeaway coffee cups may provide a helpful nudge to consumers to abandon a throw-away culture, but for lasting change, proposals like these need to be part of wider, joined-up reform that shifts the burden of responsibility for all forms of packaging content, recyclability and ultimately their collection, back to the producer". There is also a lack of infrastructure to recycle them says the committee and disposing of coffee cups in on-street bins creates a costly waste contamination problem for local authorities.
A cross-party committee called for urgent action to curb the mountain of up to five billion disposable coffee cups dumped each year, nearly none of which are recycled.
A report published by the cross-party group says there is "no excuse for the reluctance we have seen from government and industry to address coffee cup waste".
"We recognise that there is growing concern about the number of single-use paper cups being used and that our customers are interested in ways that we can help them reduce, reuse and recycle". Costa is also collecting cups from rival brands in its shops. That's just one out of every 400 cups. Yet only 1-2% of customers take advantage of the offer.
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In a series of trials at 12 coffee shops in Cardiff, the study found almost a 20% increase in hot drinks sales with reusable cups if stores offer free reusable coffee cups and charged for disposable ones.
Suez's Palmer-Jones agreed, commenting that a charge "should be used to fund the collection of cups, since once they are separately collected they have a value and can be made into new products".
"We've seen with the plastic bag charge an 83 per cent reduction in plastic bag use", Ms Creagh said.
"With all the will in the world we can't make that change and we wish we could".
Additionally, it said that producers needed to pay more for packaging that proved hard to recycle, and that labeling needed to be improved so that consumers knew how to properly dispose of their cups. "The government must do the same and introduce the levy as soon as possible". The recycling process is complex, as it consists of separating a thin plastic layer from paper, and most recyclers don't have the ability to do this.
The figure is much less than the 25p suggested by MPs as the sort of levy that would drive people to stop using the cups.
The cross-industry collaboration aims included to work towards delivering a long-term, nationwide paper cup recycling solution which builds on the recycling activities achieved so far by the paper cup industry.