UK Government Urged to Remove VAT on Refurbished Electronics to Boost Circular Economy

A coalition of businesses, charities, and community organisations has called upon the UK government to eliminate VAT on repaired and refurbished electronics, citing potential economic and environmental benefits. The initiative aims to reduce household expenses while promoting sustainable consumption patterns.

The formal request, addressed to Environment Secretary Steve Reed, emphasises that refurbished electronics currently bear the same VAT burden as new products, creating an unnecessary barrier to sustainable purchasing decisions. Back Market’s UK General Manager, Katy Medlock, highlights price as the primary factor influencing consumer choices between new and refurbished electronics.

Market analysis suggests the repair economy could generate substantial employment opportunities, with projections indicating 31,000 new jobs by 2035, expanding to 80,000 by 2040. Dr Adam Read, Chief External Affairs and Sustainability Officer at Suez UK, emphasises the sector’s potential to create meaningful employment whilst supporting environmental objectives.

The proposed VAT reduction would significantly impact market dynamics, potentially halving costs for consumers through reputable repair systems. Educational institutions report growing interest in repair-focused programmes, particularly among young adults aged 18-24, indicating a shift in vocational preferences aligned with sustainable practices.

The Treasury maintains a cautious stance, with a spokesperson indicating tax policy decisions remain reserved for fiscal events. The government’s commitment to waste reduction is evidenced through its circular economy taskforce, tasked with developing a comprehensive strategy for England’s electrical equipment reuse and recycling initiatives.

The collective appeal, endorsed by 25 prominent organisations including Currys and the Restart Project, represents a significant push towards establishing a more sustainable approach to electronics consumption in the UK market. The initiative demonstrates growing industry support for regulatory changes that could reshape consumer behaviour and environmental impact.