Brussels, 29 September 2026 — The Circular Fashion Federation (CFF) convened yesterday morning the Circular Fashion Policy Dialogue (CFPD26), bringing the whole textile value chain and policy chain into one room: the European Commission (DG ENV, DG TAXUD), Members of the European Parliament, producer responsibility organisations, brands, repairers and resellers. Five weeks before the Commission’s consultation on VAT and the circular economy closes (4 November) and ahead of the Circular Economy Act, expected mid-November, participants agreed on one diagnosis: circular models will not scale while EPR rules stay fragmented across 27 Member States and taxation still favours the linear model. The Federation presented new field evidence showing that the margin freed by a reduced VAT rate would be overwhelmingly reinvested in circular businesses, first in jobs and wages, rather than passed on to prices.
Circularity as Europe’s competitiveness answer
Opening the debate, CFF President Maxime Delavallée framed circularity as the most European response to rising tariffs and volatile raw material costs, for a sector employing more than 1.3 million people in the EU. He announced the Federation’s 2027 roadmap, built around one goal: turning regulation into competitiveness
MEP Rasmus Nordqvist (Greens/EFA) warned that change remains too slow. Europeans bought around 20 kg of new textiles per person in 2022, while separate collection, mandatory on paper, still lags in practice. He called for producers, not taxpayers, to bear end-of-life costs, for public procurement to drive demand, and for the single market to be used as Europe’s real advantage. EPR: from 27 schemes to one functioning market
The Federation presented the first results of its DEX project on extrinsic durability: a survey of 10,000 consumers in 4 countries across 5 product categories. It shows that cultural, individual, brand and product factors all measurably influence how long garments are kept, and that country and category patterns diverge in ways a single EU average hides.
The following roundtable on harmonising eco-modulation within textile EPR schemes brought together MEP Delara Burkhardt (S&D), Vincenzo Gente (European Commission, DG ENV), Luca Campadello (Erion Textiles) and Kerli Kant Hvass (Landbell Group). The Commission confirmed that fee modulation should rest on EU-level ecodesign (ESPR) criteria that are objective, measurable and applied equally across Member States; the textile ecodesign act is tentatively expected by end-2027. Speakers agreed on a pragmatic start with simple, applicable criteria, transparent fee calculation, and EPR revenues directed first to collection, sorting, reuse and repair, since only a small share of today’s products can be recycled
VAT: a tax system still built for a linear economy
Today, a garment resold once and repaired twice can carry twice the VAT of a new one. The Federation presented its deliverable on circular VAT, based on a survey of around 30 European repair, resale and garment-care operators. If reduced VAT rates applied, operators would reinvest the vast majority of the freed margin in wages and working conditions, recruitment, equipment and traceability, with only a small share passed on to prices, far less than VAT impact assessments usually assume. Independent estimates indicate the measure would recover 15–30% of its own cost directly. The work is endorsed by the Ellen MacArthur Foundation and Global Fashion Agenda, which presented their own analyses.
The second roundtable, with David Boublil Head of Unit at the DG TAXUD, Charlotte Krist (United Repair Centre), Klemen Drole (Vestiaire Collective) and Maria Akerfeldt (H&M), highlighted how the margin scheme and cross-border reporting burden second-hand operators. The Commission recalled that EU law already allows reduced rates on clothing and footwear repair, but only a minority of Member States apply them.
A Circular Economy Act in mid-November
Closing the event, Eric Mamer, Director-General of the DG Environment, announced that the Circular Economy Act will be presented in mid-November around three pillars: removing single-market barriers to circular products, ensuring producer responsibility organisations operate on clear and transparent criteria, and managing waste streams to extract more value, including easier cross border circulation of end-of-waste materials.
What the Circular Fashion Federation asks for
• Member States, now: apply the reduced VAT rate already permitted for clothing and footwear repair, and simplify the margin scheme in national practice.
• EU institutions, by 2028: extend reduced rates to circular services and lift the incompatibility with the margin scheme, in a time-bound framework tied to measurable objectives.
• Circular Economy Act: harmonised, transparent eco-modulation criteria for textile EPR, with fees that cover real end-of-life costs and reward reuse and repair.
The Federation will respond to the Commission’s consultation on VAT and the circular economy before 4 November 2026.
They said
“Circularity was not the norm of yesterday, but it will be the norm of tomorrow. The question is whose model will get there first, and as a proud European, I hope it will be ours.” — Maxime Delavallée, President, Circular Fashion Federation
“One internal market, not 27 separate ones, is our real advantage in global competition.” — Rasmus Nordqvist, Member of the European Parliament
“The crucial question is how we make sure EPR systems are not financing waste, but make circularity the attractive alternative. The Circular Economy Act is a huge opportunity; it now needs to deliver with clarity and ambition.” — Delara Burkhardt, Member of the European Parliament
“The circular economy has been one of the most important files I have dealt with. To drive forward the sustainability of the textile industry, it is extremely important for us to work with the sector.” — Eric Mamer, Director-General for Environment, European Commission
About the Circular Fashion Federation
The Circular Fashion Federation brings together more than 300 members and partners across the textile value chain: repairers, resellers, garment-care operators, collectors, recyclers, platforms and brands. It works to make circular models the competitive standard for European fashion, a market expected to double from €50.9bn in 2025 to €104bn by 2030 (CFF × KPMG, 2026). Its circular VAT deliverable and the European Manifesto for Circular Fashion are available at federationmodecirculaire.fr/en.
Press contact Clara Cherblanc, Head of Advocacy and Public Affairs at clara@federationmodecirculaire.fr