Question to the HM Treasury:

To ask the Chancellor of the Exchequer, if she will make an assessment of the potential merits of (a) VAT reductions, (b) tax breaks and (c) other financial incentives for businesses engaged in (i) upcycling and (ii) the sustainable production of textiles.

The Government has inherited a challenging fiscal position, with debt near 100% of GDP and borrowing more than double what it was before the pandemic. In addition to this, a Treasury audit in July 2024 revealed an additional £21.9 billion pressure on departmental spending.

As a result, the Government will have to take difficult decisions in relation to tax, spending and welfare at the budget.

Defra are convening a taskforce of experts to help to develop a Circular Economy Strategy for England. The Taskforce will consider the evidence for action right across the economy, and as such the Taskforce will evaluate what interventions may need to be made in the textiles sector as it helps to develop the Circular Economy Strategy.