I think it's working as intended. It incentivises buying a good quality plastics or cloth bag and reuse.
Most people won’t shop enough in their life to pay back that organic cotton bag - reusing twice a week, it will take you 200 years before you break even.
1: https://www2.mst.dk/udgiv/publications/2018/02/978-87-93614-... - see section 6.3 for reuse numbers