The UK government should reduce VAT on refurbished electrical products to mitigate waste, per the CEO of a leading electrical goods retailer.
Alex Baldock, head of the UK’s largest electrical goods retailer, asserts that VAT on refurbished electrical items should be significantly lowered or removed. Baldock explained, “It has already been charged once on these products. I would like to see a radical reduction or entire cut on these products.”
The demand for second-hand electricals is rapidly increasing, with new participants entering the market alongside established retailers and online platforms. Vinted, a second-hand fashion marketplace, recently added an electronics category to meet the growing demand for pre-owned gadgets such as gaming consoles, speakers, and fitness trackers.
Economic conditions and heightened awareness of environmental impacts are driving this shift towards refurbished goods. In 2022, the UK produced the second-highest amount of e-waste per capita globally. Currently, only 17% of unwanted gadgets are recycled worldwide. Nearly 500 million small electrical items, ranging from headphones to handheld fans, were discarded in the UK last year, according to Material Focus, an organisation aimed at reducing electrical waste.
The technology sector contributes over 1 billion tonnes of greenhouse gases annually, accounting for almost 3% of global emissions, making it the seventh-largest contributor worldwide. Mending a single smartphone can save over 77kg of carbon emissions, according to research by the French ecological transition agency Ademe.
To promote repair and reuse, the company is employing cost-cutting techniques such as video calls to address basic gadget issues, like resetting or reloading software. Baldock noted that about 70% of returned laptops have no faults—issues are often software-related. Similarly, 30% to 40% of returned televisions are fully functional.
The company’s repair centre experts have successfully used live video to fix web-enabled devices and are now expanding this method to appliances like fridges and ovens. Repairing and reselling refurbished items may help the company reduce the 8.1 million defunct gadgets sent to external recyclers annually.
As the government considers making sellers responsible for recycling costs under the extended producer responsibility (EPR) scheme, Baldock hopes for a different approach. Recycling is costly, and if these expenses cannot be passed on to consumers, retailers may be less inclined to recycle.
Reducing VAT on refurbished electrical products could significantly decrease e-waste and environmental impact, supporting a growing market trend towards repair and reuse.