Less than half of the contents of the average shopping basket is recyclable
UK supermarkets produce too much packaging, almost 40% of which is non-recyclable, local councils say.
The Local Government Association argues supermarkets should pay towards the collection of their packaging as an incentive to cut back.
In a survey of 29 common grocery items, it found Waitrose had the most wrapping while Tesco had the least.
But Waitrose said it had cut the weight of its packaging by a third since 2001 and believed the report was misleading.
Lidl had the least recyclable packaging on their products, Sainsbury's contained the most.
Since the LGA's first report in October 2007, the amount of food packaging created has decreased on the whole, but the amount recycled has stayed almost exactly the same.
At a time when people are trying to tighten their belts, this excessive packaging is leading to greater use of landfill sites and therefore higher council tax bills, the LGA said.
Councils currently pay £32 in landfill tax for every tonne of rubbish they throw into landfill, and this will continue to rise.
Councillor Margaret Eaton, chairman of the LGA, said that less packaging of food would make life easier for the businesses themselves as well as consumers.
"If we had less unnecessary packaging it would cut costs and lead to lower prices at the tills. When packaging is sent to landfill, it's expensive for taxpayers and damaging for the environment.
"If retailers create unnecessary rubbish, they should help taxpayers by paying for it to be recycled."
HOW MUCH PACKAGING COULD BE RECYCLED?*
Sainsbury's - 67%
Co-op - 66%
M&S - 66%
Tesco - 65%
Morrisons - 64%
Waitrose - 62%
Asda - 60%
Lidl - 58%
Based on sample of 29 items Source: LGA
The LGA said that the cost of all this packaging is undermining householders' own recycling efforts.
Marks and Spencer (M&S), which had come second to last in both previous surveys for its heavy packaging, has risen to second best.
The head of food packaging at M&S, Helene Roberts, said that it was all part of the company's "Plan A".
"We have taken 2,600 tonnes of packaging out of our food products since the launch of Plan A in January 2007.
"An example to illustrate this: Over 60% of the packaging used in all M&S pizzas has been stripped away, totalling almost 500 tonnes of cardboard and 83 tonnes of plastic to be saved in the next year."
Waitrose said it had cut product packaging weight by over a third since 2001.
"We are currently going through the report and believe it to be misleading. It fails to use accurate comparisons - a 500g tomato punnet at Waitrose is compared to a 250g punnet at most other stores," the company said in a statement.
"Around 20% of all our fish and meat sales are over the counter but this study chose to only compare the pre-packed option," it added.
The British Retail Consortium (BRC) said the survey did not recognise the key role packaging plays in preserving food, which cut down on waste.
The BRC's head of environment Bob Gordon said: "It's a nonsense to suggest that retailers swathe their goods in masses of unnecessary packaging. This would simply be a pointless cost. Packaging reduces waste by protecting and preserving products.
"Retailers pay over £5bn a year in business rates towards local authority funding. The biggest barrier to recycling is local authorities' failure to agree on which materials they're prepared to recycle."