A great way to tackle our ‘throwaway culture’. The Swedish Govt. is cutting VAT on fixing everything from bikes to washing machines.
One of the main blockers in the Circular Economy is that labour taxes are higher than product related taxes eg. import/export or raw material. Therefore throwing away is subsidised and more often it’s cheaper to buy a new gadget than to get it fixed. Sweden is taking the lead and trying to fix this issue.
The Swedish Govt. is cutting the VAT rate on repairs from 25% to 12%. They are also thinking how they could cut income tax related to the labour involved in repairs.
Let’s hope more countries follow…