New report calls on Government to introduce ‘penny tax’ on clothes 


The Environmental Audit Committee has called on the Government in a new report to make fashion retailers introduce a one penny producer responsibility tax on each item of clothing. 

It believes that this charge could pay for better clothing collection and recycling and will make retailers take more responsibility for the waste they create.  


Taxation should also be reformed to reward firms that offer clothing repairs and reduce the environmental impact of their product, as well as penalise those that do not, said the Committee. 

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This could include extending the proposed tax on virgin plastics to synthetic textile products to generate the market for recycled fibres in the UK. 

The Committee wants the new EPR scheme to improve research by Government and industry into the environmental performance of different materials and measures to reduce microfibre pollution. 

This report also calls on Ministers to explore how they can support a new ’sharing economy’, with hiring, swapping or subscription clothes services. 

Other key recommendations in the report include: 

  • Mandatory environmental targets for fashion retailers with a turnover above £36 million 
  • Use a tax system to shift the balance of incentives in favour of reuse, repair and recycling to support responsible fashion companies 
  • The Government should follow Sweden’s lead and reduce VAT on repair services 
  • Lessons on designing, creating, mending and repairing clothes should be in the school curriculum  
  • The Government should publish a publicly accessible list of retailers required to release a modern slavery statement. This should be supported by an appropriate penalty for those companies who fail to report and comply with the Modern Slavery Act 
  • The fashion sector must work together to set out their blueprint or a net zero emissions world and reduce their carbon consumption back to 1990 levels.  

Environmental Audit Committee chair Mary Creagh said: “In the UK we buy more clothes per person than any other country in Europe. ‘Fast fashion’ means we overconsume and under use clothes. As a result, we get rid of over a million tonnes of clothes, with £140m worth going to landfill, every year. 

“Fashion retailers must take responsibility for the clothes they produce. That means asking producers to consider and pay for the end of life process for their products through a new Extended Producer Responsibility (EPR) scheme. The Government must act to end the era of throwaway fashion by incentivising companies that offer sustainable designs and repair services. Children should be taught the joy of making and mending clothes in school as an antidote to anxiety and the mental health crisis in teenagers. Consumers must play their part by buying less, mending, renting and sharing more.” 

She also recommended that the Government strengthen the Modern Slavery Act to require large firms ensure forced labour is not in their supply chain. 

The report warns that although some parts of the sector are making progress in reducing their carbon and water consumption, these improvements have been overshadowed by the increased quantity of clothes being sold. 

It concludes that a voluntary approach to improving the sustainability of the fashion industry is failing with just 10 retailers signed up to reduce their water, waste and carbon footprints. From this, it suggests that compliance with WRAP’s Sustainability Clothing Action Plan targets should be made obligatory for all retailers with a turnover of more than £36 million as a ‘licence to practice’.  

The report also proposes that the Government work with retailers to increase use of digital supply chain technology for better traceability.  

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