US' ACT launches petition to end double taxation on 2nd-hand goods

American Circular Textiles (ACT), in collaboration with a coalition of its member companies, has announced the launch of a nationwide petition to eliminate double taxation on second-hand goods, repairs, and alterations. The initiative is a bold step towards raising awareness about the unjust financial burden placed on consumers who opt for sustainable and affordable shopping alternatives.

At present, numerous states across the US impose sales tax on second-hand items, including clothing, shoes, and accessories. This results in a form of double taxation, as consumers are taxed both at the point of initial sale and again when these items are resold. The policy has sparked criticism for discouraging eco-friendly shopping habits and impeding the growth of the second-hand market, repair options, and the broader circular economy, ACT said in a press release.

An estimated 85 per cent of used clothing ends up in landfills or incinerators, much of which could otherwise be resold or repurposed. By imposing sales tax on second-hand items, states are inadvertently contributing to this waste problem, hindering efforts to promote sustainable consumption.

Participating in this campaign are several of ACT's prominent members and affiliates, including America's Best Cleaners, Arrive Recommerce Inc, Fashionphile, Project Repat, Sortile, ThredUp, Vestiaire Collective, and unspun.

“Consumers’ pocketbooks are stretched thin. Monthly spending on apparel and footwear has risen a whopping 72 per cent since January 2020, and more shoppers are turning to second-hand first. Ending double taxation is not only the fair and just thing to do, it will also spur economic growth and strengthen the trend towards shopping for well-made clothing that can be reused and/or repaired rather than tossed into the ever-growing piles of apparel waste,” said Rachel Kibbe, CEO and founder, American Circular Textiles.

"Eliminating the double taxation on second-hand goods is smart policy. It will not only help fuel the circular economy, but it's also a common-sense approach to further empower consumers to make smart, sustainable choices. It's a clear win for the future of fashion and taxpayers who want to do the right thing," said Alon Rotem, chief legal officer, ThredUp.

Fibre2Fashion News Desk (DP)