To make the tax system fairer for women, VAT on women’s sanitary products will be cut to 5% from 1 January 2001, Paymaster General Dawn Primarolo announced today.
Ms Primarolo said:
“Today’s measure shows the Government’s willingness to listen to the views and concerns of women throughout the country. This is not a luxury consumer product. This is about fairness, and doing what we can to lower the cost of a necessity. Our action today sends a signal to women that we will continue to work towards equality in the tax system, the workplace and in society as a whole”
In order to give businesses time to adjust their pricing structure, and retailers time to adapt their accounting systems, the reduced rate will be implemented from 1 January 2001.
Customs are consulting trade groups to establish a clear and workable definition of those sanitary products which will be taxed at the reduced rate.
NOTES FOR EDITORS
1. Women’s sanitary protection is currently taxed for VAT purposes at the standard rate of 17.5%.
2. European law allows sanitary products to be taxed at a reduced rate. The UK has agreed with its European partners not to extend its zero rates beyond those in place on 31 December 1975. Therefore, it is not possible to reduce the rate of VAT on sanitary products to zero.
3. The reduced rate of 5% applies currently to domestic fuel and power, and the installation of energy saving materials in the UK.
4. The measure will cost UK Pounds 35 million per year.
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