Ultra-Fast Fashion is a Sin, and it’s Time to Tax it Like One
Fashion, particularly fast fashion, is one industry that is notoriously known for generating massive amounts of waste and emitting pollution in the process.[1] According to the UN Environment Programme (UNEP), the industry is the second-biggest consumer of water and is responsible for 2–8% of all global carbon emissions.[2]
The U.N. Intergovernmental Panel on Climate Change reported earlier this year that the world is likely to pass a dangerous temperature threshold within the next ten years, pushing the planet past the point of catastrophic warming.[3] The report, one of the most definitive reports ever published about climate change, found that climate disasters will become so extreme that people will not be able to adapt unless nations drastically transform their economies and immediately transition away from fossil fuels, which release large amounts of carbon dioxide, a greenhouse gas, into the air.[4]
Unfortunately, fast fashion and its impacts have historically been overlooked by consumers and regulators. This is beginning to change in both the United States and around the world, as new regulatory proposals, intended to drive greater sustainability in the fashion industry, have emerged.[5] For example, The Fashion Sustainability and Social Accountability Act is a New York state bill that, if passed, would make New York the first in the country to hold the biggest brands in fashion accountable for their environmental and social impacts.[6] The bill requires fashion companies that generate more than $100 million in revenues, practically every large American and international fashion name, to disclose their supply chains across all production tiers and where in that process they create the most impact.[7] They must then reduce those effects in line with targets outlined in the bill.[8] Fashion companies found to be out of compliance with these standards may be fined a percentage of their annual revenues.[9] The bill contains certain measures, like requiring the state attorney general to publish an annual list of companies that violate the law, that will give consumers confidence that significant industry players are being held accountable.[10]
While the New York Bill and similar regulations are certainly a step in the right direction, many current regulations are aimed at disclosure and accountability, such as by changing what consumers see on their clothing labels or providing disclosure about the practices of companies they are considering purchasing clothing from.[11] In theory, this allows consumers to make more informed choices. However, this is all premised on the idea that consumers will make the environmentally and socially conscious choices when given that information. But will that happen?
Younger Americans, mainly Gen Z and Millennials, claim to care deeply about climate change and protecting the environment.[12] Although young adults in the U.S. may be concerned about climate change, it is unclear to what degree they are really engaged and committed to change.[13] These same young adults are the leading consumers of fast fashion.[14] Fueled by low prices and social media pressure, many young adults regularly engage with and purchase fast fashion.[15] However, there does not appear to be any confusion that fast fashion is environmentally and socially irresponsible and harmful. So, if many consumers know what they are doing is environmentally and socially irresponsible and harmful, yet they continue to engage in the activity, how will increased disclosure of harmful practices make any meaningful impact? It likely won’t. After all, how many consumers in the market for a $10 dress consult the state attorney generals’ publications before making their decision? Surely not many. We must look for other ways to curb fast fashion. And, what do many Americans hate just enough to potentially change their behavior? Taxes.
It is easy to villainize big corporations, and perhaps rightfully so, but individuals should also pay for their choices. Fast fashion harms everyone.[16] When a consumer chooses to buy the new Shein Printed Spaghetti Strap Dress for $8.49, the consequences of that choice are felt by everyone (and not because the dress should be criminal to wear, although that could be debated, but ultimately that is outside the scope of this post). The harm is to everyone, globally. The harmful choice made by one consumer, is felt by the workers who are underpaid and exploited, as well as by the environment, which we all live in.[17].
Sin, or excise, taxes are an established tactic used to dissuade individuals from consuming goods that are deemed to be morally suspect, harmful, or costly to society.[18] Common examples include cigarettes, vaping, alcohol, gambling, gasoline, and sugar.[19] The primary reason for levying a sin tax on these types of goods is to deter people from using them, while also providing additional revenue for governments.[20] The revenue collected from these taxes is often used to help cover the costs related to the taxed item.[21] For example, sin tax revenue on gasoline can be used to fund new construction on highways, or sin tax revenue from alcohol sales can be used to support individuals with alcohol addictions. Furthermore, it has consistently been shown that over time, sin taxes do work in reducing the behavior they are meant to discourage, especially among younger consumers.[22]
Fast fashion is undeniably harmful and costly to society.[23] Unlike cigarettes and alcohol, which mainly harm the consumer of the good, fast fashion harms everyone, even those who choose not to buy it. But, at the end of the day fast fashion would not exist if there weren’t a demand for it. While we cannot, and probably should not, police what clothing individuals demand and buy––we can, and should, place a sin tax on fast fashion that is harmful and costly to society as a whole. Placing a sin tax on consumers of fast fashion could change consumer behavior, discourage frivolous consumption, as well as provide revenue to governments to combat the environmental costs imposed by the consumption of fast fashion.
It is important to be mindful that sin taxes are regressive, meaning the tax is an absolute currency amount levied uniformly to all of the population, regardless of income.[24] This places a larger burden on lower income demographics. Clothing is a basic human need, so it is imperative that these taxes be carefully applied so as not to burden lower income individuals who need access to affordable clothing.
One potential way to place a sin tax on consumers of fast fashion but ensure that individuals can still purchase affordable clothing is to place the taxes on “ultra-fast fashion” consumers. Shein, and others like it such as Pretty Little Thing, Fashion Nova, Boohoo, are the newest iteration of fast-fashion: ultra-fast-fashion.[25] Ultra-fast fashion refers to a mass-production, mass-consumption business model in which low prices are paired with rapid trend turnover.[26] Rather than following the traditional high fashion calendar, fast fashion brands race through micro-seasons.[27] Ultra-fast fashion is the same but at top speed. Where once fashion revolved around a few seasonal collections, ultra-fast fashion has turned fast fashion’s weeks into days and dozens of styles into hundreds and thousands.[28] Shein, an ultra-fast fashion giant, was recently valued at $100 billion, making it the third most profitable start-up in the world, worth more than fast fashion goliaths Zara and H&M combined.[29] Shein drops up to 10,000 new items on its website daily.[30] In a recent 12-month period, the Gap listed roughly 12,000 different items on its website, H&M about 25,000, and Zara some 35,000.[31] Shein, in that period, had 1.3 million.[32]
While access to affordable clothing is a need, access to thousands of new items daily, all essentially meant to be discarded after one wear, and all posing undeniable social and environmental costs is certainly not. Shein, and companies like it, depend on synthetic textiles, damage the environment, encourage people to refresh their wardrobes nonstop, produce tremendous waste, all while workers are paid little to labor in exhausting, sometimes dangerous conditions and all individuals, even those who choose to purchase more environmentally and socially responsible clothing, are forced to feel the effects. While these companies should certainly face consequences for the damage they cause, consumers should too.
Footnotes
