I'm catching up on Fashion Round Table open letters such as this one Post-Brexit in 2021
VAT fracture was my experience of Brexit. It's in the open letter for exports.
For the sake of UK fashion brands ... 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.Oddly enough, the new EU €3 tariff isn't so much of a problem. Send.Royalmail.com can add the money if I give enough detail about what I'm sending. They copied software written quickly to pay a new Trump tariff in the US. I wrote to their help desk on 20th of July 2026 to ask if they can help with VAT now, as a substitute for the slow expensive systems that have cropped-up gradually, usually based on DHL.
Thank you for contacting Royal Mail.
After reading through your case notes I can see that you would like to find out if there is a way to pay French VAT charges in advance.
I am sorry to say that at present Royal Mail/Parcelforce do not offer this type of service. The intended recipient in France will receive some form of notification from the French Customs.
I am sorry that on this occasion I could not provide you with a more favourable response to your enquiry. . If you require any further assistance in the future please feel free to visit our Help and Support
The same goes for importing, if I am not registered for VAT. I pay Italian VAT on boots. Then the courier charges VAT on import. If I ask the seller whether they can knock-off the VAT, it depends which country and what kind of VAT export scheme exists and the supplier has time to use, but the general rule is that they'll only do it if I have a UK VAT number.
I saw there was a UK government response to the open letter.
Prior to 31 December 2020, VAT was due on goods sold to consumers from the UK to the EU through the VAT return system. VAT was either due in the EU Member States or in the UK, and was remitted to the relevant tax authority through a VAT return.
From 1 January, the UK has left the Single Market and the EU Customs Union. Items moving between countries normally attract customs duty and import VAT (where applicable) in the country of importation.
[section on the UK Trade and Co-Operation Agreement and how it dealt with tariffs went here].
Exports of goods from Great Britain to the EU are zero-rated for UK VAT, and the importer of goods into an EU Member State may incur a charge of VAT. The tax treatment of these goods upon importation into the EU is a matter for the EU. Note that the EU VAT Directive requires Member States to exempt imports of goods of negligible value from VAT. Further information can be found on the European Commission website under taxation and Customs Union.
So the system might just work for a lorry load of goods sent by a courier that can do the administration, but it is so creaky for one-off parcels that trade ceased, just as there isn't much trade with other countries that don't have a generous tax-free minimum import. The problem is that even if a few exporters make the system work and pay in advance, others won't and EU customers give-up on any UK-made product for fear of it coming with an extra VAT and collection bill and a note to collect from a sorting office.
This wouldn't matter if I could buy from the UK - safety boots for example. There used to be a couple of big factories making them cheaply here, in Bristol and Rushden. Unfortunaly, exchange-rate hikes make it very difficult to manufacture anything in the UK and both firms closed after one exchange-rate hike or another. There is also a problem getting UK consumers to recognise that UK manufacturing can be a feel-good choice with ethical advantages. This applies to retail customer, and wholesale ones who can be capricious and take their order to another factory or another country; small factories face a boom and bust existance which would lessen if wholesale customers could use UK origins as more of a sales point, and took pride in nurturing suppliers. (The example that comes to mind is East End Manufacturing, which I knew as a small shareholder.)
There's another problem of a government that prioratises the "creative economy", which is that non-manufacturing sides of fashion get on the same lobby letter, sometimes arguing in opposite directions.
Different lobby points for different activities: mass retail.
Oxford Economics and the £35 billion figure that fashion "contributes"
The retailers have their "35 billion" figure for things like clothes shop turnover, expanded to include things like PR and advertising and quite a small amount of UK manufacuring. I think there's another Oxford Economics repord with a lower figure produced for UK Fashion and Textiles in 2023 that mentions "barriers to procurement", so these reports are not all bad. The trouble with including so much retail in the figure is that if people didn't spend money in clothes shops they'd spend it somewhere else, maybe somewhere where the money circulates more often round the UK economy than a pounds spent on Bangladeshi textiles in Next or on Temu. I suppose I should keep quiet about this as a retailer myself - although I sell things made in the UK - but there's another odd group....London Fashion Week trying to "put London on the map"
London Fashion Week civil servants who "put London on the map" at some cost including a kind of crowding-out of attention to real life manufacturing or small business. They also add to crowding on the Picadilly Line and count that as one of their measurable benefits. Really. I have done freedom of information requests to check! They claim footfall and column inches as signs of success.If the whole event could close, or start showing fashion made closer to home with names of the factories included on the stands, and if the export credit from UK Trade and Investment was well monitored, maybe we'd get some benefit from them. If exhibitors were nominated by UK factories, so the ones who were good customers got nominated, that would be better still.
Oddly enough, this was mentioned in the exchange of letters. Civil servants and ministers are led to believe that British Fashion Council is something to do with the sector:
Secondly, we are unable to liaise with the British Fashion Council, as they are not as responsive as we, or you, need. Whilst we appreciate their dedication to British design talent, new emerging designers and creating export opportunities for these brands overseas, they do not represent the entire fashion industry. London Fashion Week is a twice yearly event, which for the modelling industry represents no more than 3% of their business and this is echoed across the sector. They do not have the entire fashion sector's interest as their core remit, unlike Fashion Roundtable. For example, if you are a machinist in Leicester, a model in Manchester, own a shopping complex in the West Country, a modest fashion company in Leeds, a denim brand in Cardiff, a brand in Liverpool, a manufacturer in Halifax, a fashion tech company in the Midlands, a boutique owner in Brighton, a stylist in London, a fashion photographer in Margate, a bridal shop in Mayfair, a consultant who lives between London and Paris, a sustainable brand in Oxfordshire, a handbag brand in Wimbledon, or a cashmere brand in Edinburgh, it is unlikely the BFC would be able to support your requests