UK electronics firms want VAT off spare parts and repairs • The Register

A newly formed group of UK electronics companies is advocating for the removal of VAT on electronic spare parts, repairs, and labor in the government's upcoming autumn budget, claiming this would encourage consumers to get kit repaired instead of replacing it.

The group, which calls itself CLEAR (Circular Leadership for Electronics and Recycling), says it aims to address the growing issue of electronic waste and the barriers preventing consumers from repairing rather than replacing electrical items.

Members of the group include consumer brands such as ProCook, Positec Power Tools Europe, Glen Dimplex Home Appliances, and Melitta, while the group is chaired by James Rigg, chief exec of Trojan Electronics, which provides repair, refurbishment, and resell services as well as contract manufacturing.

According to Rigg, getting rid of VAT charges on electronic repairs is a "crucial step" in creating a more circular economy. However, CLEAR is going further and also lobbying for the British government to follow the example of countries like Austria and France, which have introduced subsidies for electrical repairs.

"With the upcoming budget, we believe it's essential to focus on VAT reduction as the first step toward broader circularity measures. This will make repairs more affordable, reduce electronic waste, and promote sustainability," Rigg said in a statement.

He claims that many consumers think it is cheaper to buy a new item than have their existing one repaired, and also hesitate to get their electronic kit fixed if the cost approaches the price of a new device.

Of course, if vendors find they no longer have to pay VAT on certain things to the government, they are sure to pass that benefit along to the consumer, right?

Trojan is backing up the CLEAR campaign with a consumer survey [PDF] the company conducted last year of 300 people about their purchasing habits with electronic goods.

It found 64 percent of respondents had bought a refurbished or repaired electronic product in the past, with 14 percent saying they had bought a refurbished smartphone.

The company claims that 82 percent of consumers recognized the role they could play in reducing e-waste, and says this highlights a growing demand for sustainable solutions.

According to the survey, most buyers had a positive experience of reconditioned kit, with 24 percent saying they couldn't tell their item was refurbished and 79 percent indicating they would buy one again.

Meanwhile, 41 percent of those in the survey said that quality was the most important attribute when making an electronic purchase, with 31 percent saying price is more important.

"Unsurprisingly, price is important to customers, particularly during the cost-of-living crisis," Rigg said. "However, we know that refurbished products offered at a lower price than brand-new ones open the market up to customers that otherwise wouldn't have bought a branded or top-of-the-range item, rather than taking away sales that would have been made anyway."

Manufacturers selling their own reconditioned products would encourage consumers to opt for them, the survey found – as has been demonstrated by Apple and its Certified Refurbished iPhones and Macs. And 17 percent of customers would be more likely to buy revamped or repaired kit if such items were more visible in store or online.

Trojan reckons the global refurbished electronics market had a value of $85.42 billion in 2021, and is estimated to grow at an average rate of about 12 percent through 2031, totaling $272.91 billion that year.

The CLEAR group members have also discussed a range of other proposals, including a traffic light system for electronic kit similar to food labels; enhanced Right to Repair legislation; and improvements to curbside collection services for discarded electronic gear.

As is usual, the EU is ahead of any move the UK might make, with the European Parliament adopting a right-to-repair directive earlier this year, obliging manufacturers to repair products and make spare parts and tools available for "a reasonable price".

However, the chances of CLEAR succeeding in its efforts on VAT reduction seem slim when UK finance minister Rachel Reeves has indicated that she needs to fill a £22 billion ($28.6 billion) funding shortfall that the current government blames on the previous Conservative administration. ®

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