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Industry Talk

US ‘tech tax’ threat to UK fashion

Trade dispute is nothing to do with the textile industry, association says.

30th March 2021

Innovation in Textiles
 |  London


The UK Fashion and Textile Association (UKFT) has expressed disappointment at the announcement that the USA is considering putting tariffs of up to 25% on a host of UK exports in retaliation for a UK tax on technology firms.

These include women’s and girl’s dresses, men’s and women’s coats, men’s shirts, ties and shoes, according to a list published by the Biden administration.

The duties are designed to raise $325 million – the amount the US believes the UK tax will raise from US tech companies. The tariffs are now subject to a consultation in the US over the next few weeks.

“It was only earlier this month that the US removed additional tariffs on some UK-made fashion products so it is hugely disappointing that yet again our manufacturers are threatened with additional tariffs, particularly as the trade dispute has nothing to do with our industry,” said Adam Mansell, UKFT CEO. “At a time when we are trying to start discussions over a UK-US trade deal, it is extremely important that both governments get around the table to remove this threat as soon as possible. With the industry still struggling with the impact of Covid-19 and understanding the new trade arrangements with the EU, an additional burden on our exports couldn’t come at a worse time.”

A UK government spokesperson told the BBC: “Like many countries around the world, we want to make sure tech firms pay their fair share of tax. Our digital services tax (DST) is reasonable, proportionate and non-discriminatory. It’s also temporary. We’re working positively with the US and other international partners to find a global solution to this problem and will remove the DST when that is in place.”

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