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11 March 2020
As expected, the government has announced that the 5% rate of VAT on women’s sanitary products will be abolished through the application of a zero rate of VAT on 1 January 2021. This follows the enabling legislation which was introduced in Finance Bill 2016.
The VAT rate on these products was reduced to 5% in 2000, being the lowest rate possible under EU law. In October 2018, new EU VAT rules that would allow the UK to stop taxing sanitary products were proposed by the European Parliament. However they would not go into effect until January 2022 at the earliest, and no timeline for implementation has been tabled.
Now that the UK has left the EU, the government can announce the change following a long and vociferous public campaign to introduce it.
The effect on the price of the products will be minimal – estimated to be approximately £40 - £45 over a lifetime.
Read more on the Budget here.
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