There’s a familiar question that Whole Foods will stop asking shoppers: Paper or plastic?

Tuesday, Whole Foods (WFMI) will announce plans to stop offering disposable, plastic grocery bags in all 270 stores in the USA, Canada and United Kingdom by Earth Day – April 22. That means roughly 100 million plastic bags will be kept out of the environment between that date and the end of 2008, the company says.

“This is something our customers want us to do,” says A.C. Gallo, Whole Foods co-president. “It’s central to our core values of caring for communities and the environment.”

In place of the fly-away plastic bags scorned by many environmentalists, Whole Foods will offer several options: free paper bags in four sizes made from 100% recycled paper, reusable bags 80% made from recycled plastic bottles for 99 cents and canvas bags selling for $6.99 to $35. It encourages consumers to bring their own bags by taking 5 cents to 10 cents off the bill for each.

The move comes as cities, states and even countries are trying to eliminate non-biodegradable plastic bags from cityscapes, waterways and landfills. San Francisco banned them. Oakland is considering a ban. New York and New Jersey require retailers to recycle them. China announced a ban this month.

Among other retailers, most Trader Joe’s stores use paper bags, though some offer plastic. Ikea’s U.S. stores charge 5 cents for plastic bags, which is mostly donated to a conservation group.

While Whole Foods is tiny compared with the rest of the retail grocery industry, its role as a trendsetter is huge. Whole Foods’ success played a major role in nudging top supermarket chains to sell organic foods.

“By getting ahead of the inevitable, Whole Foods will maintain and enhance its halo of superiority,” says marketing consultant Pam Murtaugh.

Americans throw away about 100 billion plastic bags annually, says Worldwatch, an environmental research group. It takes more than 1,000 years for a non-recyclable plastic bag to break down in a landfill, it says. 

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