Women’s sanitary protection products and VAT

Contrary to reports, I did not vote against reducing the rate of VAT levied on women’s sanitary products.

By way of background, VAT is a tax regulated by EU law. Europe has said that whilst the UK can have some zero rated products – and we have more than nearly all other European countries – we are not permitted to change any further products’ or services’ status to zero rated. As such, the UK levies 5% VAT on sanitary protection products, the lowest we are allowed by EU law.

To zero rate sanitary protection products, there would need to be a change in the law at EU level. In order for this to happen, a formal proposal from the European Commission would be required, along with the support of all 28 EU member states. So without that strict condition being met at a European level, it would not be lawful for the UK to reduce the VAT rate on sanitary protection products to zero.

With regards to the debate in the House of Commons on Monday 26 October, the vote was not about reducing the VAT charged on sanitary protection products. The amendments tabled to the Finance Bill involved the strategy for lobbying the EU for changing the VAT rate, imposing a timetable and reporting on the progress of discussions to Parliament.

The Minister, David Gauke MP, responded directly to these points in his reply to the debate. Mr Gauke has undertaken “to raise the issue with the European Commission and with other member states, and to set out the view, which has been reflected in [the] debate, that it should be possible for a member state to apply a zero rate to sanitary products.”

He also said during the debate that he would “be happy to update the House on any developments at any stage, as and when they might occur.”

Therefore, the Government has listened and the new clauses did not need to be added to the Finance Bill that was being debated.

The Government certainly does not consider sanitary protection products to be luxury items and do not tax them as such, as has been suggested. The Minister will in fact be taking this issue forward at the appropriate level within the EU, in line with the spirit of the debate and where the decision will actually be made.