Friday, 30 October 2015

Tampon Tax

Let me be clear; there really is no difference between the political parties on the substance of this issue. Tampons are not a luxury product and should be at zero rate.

The 5 per cent VAT rate for sanitary products is however the lowest allowed under EU law, and the Government is committed to raising this with other EU countries to change EU law on this issue.

HM Revenue and Customs confirmed the VAT rate charged on the items is the lowest allowed under EU law, which meant Labour's amendment on Monday would have made no difference to the arrangements.

When Labour was in Government, Yvette Cooper spoke of amending the VAT on sanitary products, however was unable to do so. Likewise, the French government have attempted to abolish the same tax, but to no avail. The reason for this is because the tax falls under EU, not domestic legislation.

It was actually Labour who set the rate at 5% when it was in government as they too were prevented from going any lower because of European rules.

Financial Secretary to the Treasury, David Gauke, said during the debate that the government "sympathises with the aim of this clause" but that: "The UK does not have the ability to extend unilaterally zero rating to new products."

He said he would raise the issue with the European Commission and other EU member states.

Last Monday’s debate was not about whether there should be a tax on sanitary products – no one believes there should be - rather the debate centred on how to get the VAT lifted.

The outcome of this was an agreement to include a 0% VAT on sanitary items in the government’s negotiations with the EU.