Will Bulgaria’s Textiles Levy jeopardise Europe’s Recycling Sector?

Business | October 12, 2018, Friday // 16:08| Views: | Comments: 0
Bulgaria: Will Bulgaria’s Textiles Levy jeopardise Europe’s Recycling Sector?

The Bulgarian Government has proposed and drafted legislation to place a levy on all used clothing put on the market in Bulgaria. The levy is being proposed under the auspices of an Extended Producer Responsibility scheme for clothing in the country. 

At the moment, it is ‘unclear’ whether the levy will be placed on new clothing as well, reports the  Bulgarian Association of Recyclers Textiles and Second Hand Clothing (ARTSHC). It also wonders whether the funds raised through the levy will be used to help finance the collection of used clothing and textiles in Bulgaria, reports Recycling Inernational

A recycling levy or a tax?

If the latter is not the case, this would seem to simply be a tax on used clothing in Bulgaria. Such a measure would directly contravene EU free trade regulations, which prevent individual member states from taking action to disrupt or distort the trade of products. 

 The association is also concerned that if Bulgaria were to introduce this law and not be required to reverse this move, then other governments in other Eastern European countries might consider introducing similar levies in their countries.  ‘If this were to happen, this could significantly disrupt the used clothing markets,’ ARTSHC says.

Preventing burning of textiles

Ministry officials have stated that the intention of the changes to the law is to implement 2018 revisions to the EU Waste Framework Directive. The Extended Producer Responsibility fees are ‘justified’, it is claimed, in order to prevent the burning of waste textiles within Bulgaria as well as to reduce Bulgarian imports of second hand clothing.

Potential closures

Still, the ARTSHC is sceptical the levy will lead to the intended outcome and fears it will have ‘unintended consequences’ for recyclers. In the worst case scenario, it could result in the closure of sorting companies in Bulgaria as this will be a direct cost on their businesses.

‘This will jeopardise other textiles industries across Europe that export second hand clothing to Bulgaria,’ the association argues. In the end, collection systems and collectors across the EU will not achieve the value of the textiles they collect.

‘These adverse effects will undermine the general credibility of Extended Producer Responsibility, and in particular the use of Extended Producer Responsibility for the Circular Economy,’ according to ARTSHC.

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