In its report, GAO said a shift towards circularity in textiles could support new jobs and markets linked to repair and recycling, help reduce environmental harm, and influence consumer practices.
At the same time, the watchdog said stakeholders pointed to practical hurdles, notably the absence of nationwide systems and facilities to collect and process textiles, alongside funding limitations.
GAO identified a “number of policy options” based on a review of relevant literature, site visits and interviews with 49 stakeholders from across the public and private sectors.
Among the options, it highlighted extended producer responsibility (EPR) programmes for textiles, which would make companies responsible for what happens to products after use, alongside other requirements.
Another option flagged by GAO was the use of tax credits linked to textile circularity, designed to “reduce or offset the amount of taxes paid by businesses” when they take steps such as reusing textiles or reducing textile waste.
According to the agency, “some US states and other countries are proposing, enacting, or implementing most of the identified policy options” that could support the development of a textile circular economy.
It pointed to activity in US states and in the European Union, among others, where legislation has been proposed or enacted to establish textile EPR programmes.
Stakeholders interviewed for the review also weighed in on whether action should be led federally or left to states. Several, including industry groups, said they would prefer a federal approach, arguing it could support coordination, compliance and consistent implementation across states, while also helping businesses navigate other countries’ legal requirements.
The agency added that a nationally led model would still require additional coordination and resources, and would depend on the federal government’s legal authority to put such an approach in place.
The report was produced after the agency was asked to examine how a textile circular economy could be developed in the US. It defines textiles to include apparel as well as products such as carpets, footwear and towels, and links the policy discussion to rising levels of textile consumption and waste globally.
The October 2026 report follows the GAO’s previous work from December 2024 on federal efforts to address textile waste. For this latest tracking update, the review drew on legislation, regulations, federal agency documents and academic research, alongside interviews with 49 stakeholders across government, industry, academia and non-profit organisations.
As part of its evidence-gathering, the agency conducted site visits in Washington and Oregon and travelled to France and the Netherlands, where it met private-sector organisations involved in various aspects of textile circularity.
