They still do it in the US also, but you'll pay about 4x more for your milk. You can often find milk on sale for $1.99/gallon (it's a "loss leader" for supermarkets) while a half gallon in a returnable glass bottle will be $3.50 or $4.00 not including the bottle deposit.
A store in the UK (sainsburys) briefly experimented with selling milk in bags. You bought a big jug which the top-up bag clipped into. Ostensibly it reduced plastic waste. Pretty sure it was cheaper than buying bottles. It never really caught on though and they canned it.
A company once tried the usual "Let's reduce the size of the package and nobody will notice" shenanigan and made 1L bags, but it was blatantly obvious when it didn't fit the plastic jug anymore.
