THE ISSUE of VAT levied on sanitary products – popularly dubbed the ‘tampon tax’ – will be raised with the European Commission, financial secretary to the Treasury David Gauke has pledged.
Gauke said the government sympathised with efforts to force a negotiation with the EU for a reduction in the 5% VAT rate on sanitary items, but added EU law tied the government’s hands on reducing the rate to zero.
When a nation joins the EU, they can nominate a range of products and services for reduced VAT rates and sanitary products were omitted from the list the UK submitted when it joined the common market in 1973.
HM Revenue and Customs reiterated the reduced 5% VAT rate charged on the items is the lowest allowed under EU law.
Ministers rejected an amendment to the Finance Bill by 305 to 287 votes which would have forced George Osborne to publish a strategy for negotiating an exemption with EU institutions within three months.
Any change would require a European Commission proposal and the unanimous agreement of all 28 member states.
Gauke (pictured) told the BBC: “This debate illustrates there is very considerable cross-party support for the UK to abolish VAT on sanitary products.
“To that end… I will raise this issue with the European Commission and other member states setting out our views that it should be possible for member states to apply a zero-rate to sanitary products.”
There has been a sustained public effort to put pressure on the tax authorities to apply the zero-rating, with a petition calling for the law change garnering 250,000 signatures, while comedian Cariad Lloyd added her voice to the campaign with a viral video parody of Taylor Swift’s hit Bad Blood.
A Treasury spokesman said: “The UK has set the VAT on sanitary products at the minimum rate permissible under EU rules.”
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