Fashion brands call on governments to cut taxes on resale and repair. Nearly 70 fashion businesses including H&M Group, Primark, Inditex and Zalando have signed a joint statement urging EU, US and Canadian governments to cut taxes on resale and repair, saying current policy makes producing new clothes more profitable than reselling or repairing them.
The statement, coordinated by the Ellen MacArthur Foundation through its Fashion ReModel project, calls for three changes: reduced VAT in the EU and eliminated sales tax in North America on resold products and repair services; lower labour taxes and tax credits for resale and repair jobs; and extended producer responsibility for textiles to fund collection and sorting infrastructure.
A companion Foundation report, The New Bottom Line, estimates that the combined policy changes could lift gross profit margins to up to 55 per cent for resale and around 41 per cent for repair. The global secondhand fashion market is projected to reach $393 billion by 2030, according to ThredUp, growing at twice the pace of the wider industry. The statement does not reference the UK.
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