Fashion retailers, brands and designers are among more than 450 people from across the fashion industry who have written to government to call for discussions around how the effect of the EU/UK free trade deal can be mitigated.
MatchesFashion co-founder Ruth Chapman and MyWardrobe chair Jane Shepherdson, are among those who have put their names to the open letter coordinated by the Fashion Roundtable industry body, alongside representatives of brands from Kurt Geiger to Vivienne Westwood.
It says: “The deal done with the EU has left a gaping hole where promised free movement for goods and services for all creatives, including the fashion and textiles sector, should be. The fashion and textiles industry is the largest component of the previously thriving UK creative industries, growing 11% annually, bringing vital jobs and innovation to the UK. We contribute more to UK GDP than fishing, music, film and motor industries combined. Yet we have been disregarded in this deal and our concerns overlooked in current policy decisions.This has significantly impacted our opportunity to build back better and grow our onshoring manufacturing, digital innovation and sustainable design and technology in the UK, where we now, more than ever, have the real chance to show global leadership.”
On selling online, it says: “UK fashion businesses now need to have EU distributors which impact on margins. If they sell B2C online to EU customers, these customers are now charged with VAT, duties and handling fees amounting to an additional 30% on top of the product price, making them less likely to continue buying from UK brands. This will impact UK SMEs who cannot afford to pay EU distributors and use online sales platforms, the most.”
The letter also calls on the government to add garment workers to the list of shortage occupations for UK visa, and to reverse its decision to stop the VAT Retail Export Scheme, which allows for tax-free retail sales to tourists. The government says that 92% of visitors to the UK do not use the VAT Retail Export Scheme and that extending it to the EU would cost as much as £1.4bn extra a year. It says that, given the effect of Covid-19 on the labour market, UK workers should be given the chance to fill vacancies first.
A government spokesperson said: “We are working closely with businesses in the fashion industry to ensure they get the support they need to trade effectively with Europe, and seize new opportunities as we strike trade deals with the world’s fastest growing markets.”
“We are aware that some businesses are facing challenges with specific aspects of our new trading relationship with the EU. To this end, we are operating export helplines, running webinars with policy experts and offering businesses support via our network of 300 international trade advisers. This is on top of the millions we have invested to expand the customs intermediaries sector.”