To map and address these roadblocks, The Coalition Circular Accounting (CCA) studied the ‘Bike-as-a-Service’ company Swapfiets. The report ‘Making cycling circular: the case of Swapfiets’ outlines two main issues hindering ‘Product-as-a-Service’ businesses: VAT and linear depreciation.
Due to the specifics of its business model, Swapfiets does not qualify for a discounted VAT rate of 9%. Because adjusting the business model would be detrimental to the company and its circularity performance, the CCA recommends legislative changes on how VAT is applied at the EU level.
In addition, the value of Swapfiets’ assets is considered to depreciate linearly, despite the fact that the company extensively repairs and maintains its products, making actual depreciation not linear at all. This means Swaptfiets is disincentivised to perform value-adding repairs. The CCA concluded that Swapfiets should seek a new financing arrangement not based on the value of the assets, but rather on the value of its contracts or more detailed projections of the future growth potential of the business.
The case of Swapfiets can be used by other ‘Product-as-a-Service’ businesses to tackle their accounting and taxation issues. The study can be downloaded here
SURLEV has developed a method to lift existing sloped roofs instead of demolishing them to create new space without additional footprint.
The Ocean Package seeks to revolutionize packaging in e-commerce by creating a sustainable and efficient reuse system for shipping materials, b< eliminating single-use packaging and replacing it with durable, reusable solutions that contribute to a circular economy.
The Circular Investment Readiness Network (CIRN) is organising a series of sessions to support circular economy projects in overcoming development and financial challenges. The next session will take place on 27 March (09:30 - 10:30 CET) and will be hosted by Vojtech Vosecki, one of Europe's leading circular economy voices.
The CircularInvest project is furthering its mission to transform Europe’s sustainability landscape with the addition of three innovative circular projects.
