People will be paid a small sum of cash to drop off bottles and cans in a scheme to boost recycling.
Reverse vending machines will be introduced at places such as supermarkets to encourage the public to reduce plastic pollution
But critics branded the timescale “disappointing” - as it won't be introduced until 2025 across England, Wales and Northern Ireland.
The failure to include glass bottles in the scheme has been described as a “missed opportunity”.
The Deposit Management Organisation will set the amount for the refundable deposit scheme. In most cases drinks retailers will host the return points.
Around 14 billion plastic drinks bottles and nine billion cans are used in the UK every year, many of which are littered or go to landfill.
Current recycling rates for drinks containers in the UK sit at around 70%.
Countries that have introduced the scheme, including Germany, Finland and Norway, have recycling rates above 90%.
A target is in place to collect over 85% of returnable drinks containers after three years of the scheme's launch - so not until 2028.
Megan Randles, political campaigner at Greenpeace UK, said the announcement had come after "five years of dithering and pollution”.
She said: “This could have been a moment for celebration, and of course for our environment it's better to have this proposed system rather than nothing. But even at the final hurdle, this Government bottled it and excluded glass from the scheme.
“In what kind of world is collecting glass drinks containers not an essential part of a system designed to collect drinks containers?
"To be honest it reeks of corporate lobbying – from the kind of companies who talk big on social responsibility, but do everything they can to push the problems they create onto others.”
Environmental Audit Committee Chairman Philip Dunne said: “I welcome this announcement that a deposit return scheme (DRS) will be implemented in England, though it is disappointing to learn that the scheme will not come in until 2025, given the length of time the Government has spent pondering the issue.”
The Tory MP added that his committee, after hearing evidence, concluded glass should be included in the scheme.
“It is therefore a missed opportunity that glass will not be in England’s DRS at launch, but both Scotland and Wales’ DRS will include glass,” he said.
Environment Minister Rebecca Pow said: “We want to support people who want to do the right thing to help stop damaging plastics polluting our green spaces or floating in our oceans and rivers.
“This will provide a simple and effective system across the country that helps people reduce litter and recycle more easily, even when on the move.”
Last week the Government announced a ban on single-use plastics and polystyrene cups in England from October.
