Swedish TSA wins landmark tax break for consumers using professional textile services5 February 2021
The Swedish Laundry Association, Sveriges Tvätteriförbund, is celebrating good news for its members as the Swedish Government instigates a tax break for households employing the services of professional textile care businesses.
See reaction from UK trade associations and ETSA at foot of article. More comment from associatons around the world follows. This story will be updated.
As of 1 January, Swedish consumers who turn their laundry over to professional textile service companies are eligible to a tax deduction on 25% of the cost. This is applied to all laundry that could normally be washed at home, including minor repairs and transport.
Based on experiences from other service sectors covered by the same law, the deduction is expected to be used by many elderly people and families with children who struggle with work-life balance. However, the deduction is available for everyone who pays their taxes in Sweden, even when the service itself is purchased outside of Sweden.
"This reform is a glowing light in an industry otherwise hard struck by the ongoing pandemic. The demand for laundered textiles has dropped as there are less guests staying in hotels, less restaurant visits and tough limits on the number of people allowed at important events," according to Sveriges Tvätteriförbund CEO Daniel Kärrholt.
“This is also an epoch-making result for and foremost of the continuous communication by the industry organisation Sveriges Tvätteriförbund aka. Swedish Textile Service Association. The last five years the association has stepped up its efforts to increase awareness about the textile service industry and its importance in society,” said Kärrholt.
He said that the industry provides a first job for young people, people with short formal education and new immigrants to Sweden, and it has the potential to grow and generate even more jobs. “We see our diversity as a strength and our employees as our greatest asset. We are a green circular industry. We focus on good textile care which extends the life of textiles. Our production facilities are optimised for low water and energy usage which demonstrates that we are using our resources in a responsible way.”
He pointed out that the association’s member companies are indispensable partners to healthcare, industry, service industry, hotels and restaurants and others supplying workwear for industry, linen, bath and restaurant textiles, entrance mats, textiles for healthcare for both staff and patients, such as workwear, patient, surgery and bed textiles.
“Our companies have an important task, not least in the current situation to contribute to a functioning healthcare system. Our members are certified with the T-brand, which means that they have been controlled and meets or exceeds the required environmental, economic, and social standards. Customers can be certain that they choose a company that takes responsibility for their employees, the society as a whole and the planet we live on,” Kärrholt said.
Kärrholt advises textile care operators who are lobbying for change to keep on. “The system with tax reduction for household services was introduced in 2007 it has been long winding road for Sveriges Tvätteriförbund. The only advice I can give is stay on your case If your arguments are good enough you will eventually come through.”
UK and European trade associations react to the news
LCNi asked David Stevens, CEO of the UK Textile Services Association (TSA) for hsi reaction to the news. He responded by saying: "I think it’s a great scheme to encourage the professional processing of personal laundry and drycleaning. I would love to think the UK government would consider similar schemes but as we can’t even get them to support the existing commercial laundry operators who due to the closure of hospitality have seen volumes drop by over 80% I am not too optimistic…..but we will try and a massive well done to Daniel Kärrholt the Swedish equivalent of the TSA."
Ken Cupitt of the Guild of Cleaners and Launderers (GCL) said: "The news from Sweden on the proposed Tax Reduction for laundry services is an excellent boost for an industry that has been severely affected by the Corona Virus Pandemic and should be made available to consumers here also in the UK.
"Not only will it help to keep in employment many who depend on their livelihood in our business sector, but it will be a Government demonstration of its commitment to a greener economy because professional laundering is far more economic in its operation than when done in a domestic situation. Our industry can also demonstrate that our services prolong the life of textiles further proof of helping the green economy.
"Sadly, up until now, our UK Government has failed to recognise the benefits that we bring in terms of employment, and the taxes received from this, hygiene, which is so vital especially now with the current situation, and the benefits we bring in helping to lower our global carbon footprint.
"Obviously, in Sweden the industry is taken far more seriously than our experience here in the UK, and its value to them is now being recognised. Hopefully, our Government will learn a lesson from this and bring about similar measures here helping us to retain jobs that will have a payback with receipt of payment of taxes on earnings and less social subsidy in the form of payment to relieve poverty."
Elena Lai, secretary general for ETSA, the body that draws together European textile services associations, commented: "The Swedish example of tax deduction paves the way for the economic growth of the laundries and textile services market. Many low-skill jobs will be encouraged and become an instrumental entry point to the labour market itself. This is not only important during a COVID pandemic, but in general terms to foster the economy growth with job creations and to fulfil consumers’ satisfaction."