I must have watched too many episodes of Captain Planet with my kids, or perhaps it was the Woodsy Owl campaign from the 70's (anyone remember "give a hoot - don't pollute"?) One year after the gifts had been opened and I looked at the mounds of torn wrapping paper, I was really dismayed. At that moment I decided to stop wrapping gifts and find ways to package gifts that didn't lead to a stuffed garbage can.
I found a set of nesting holiday boxes at Costco and I bought a few gift boxes and bags. Each year these get carefully folded and put away to use again and again. Now I have also started using the various sizes and shapes of our Project Bags and Sock Bags as gift wrap as well. I love that these can be dual-duty as both the wrapping AND part of the gift! I'm looking forward to using the newest size bags, the Cake Bags, to wrap ornaments I'll be handing down to my kids this year now that they each have their own homes.
Christmas cards are also recycled around here to become gift tags. I think this was a craft project I did with my Grandma Grace when I was a child and I love thinking of her while I make new tags out of the cards we received in previous years (that, and I get to look at more cards from loved ones)! I never could make tags out of the cards from Uncle Wesley because he used the cards to hand write messages that covered every inch of usable space. I miss receiving those cards.
I use a variety of methods to make the tags. The simplest is to just cut around images on the cards with regular scissors, use a hole punch to make a hole to insert a piece of ribbon, and then tie the finished tag to the package. Since so many gifts are to/from the same people each year I can also recycle the tags (from Mom to Jon, from Mom to Dad, etc.). I also use an old pair of pinking shears to cut some tags with decorative edges. You can also use scrapbooking scissors for even more edging options.