The UK was unable to zero rate VAT on women’s sanitary products under EU rules and the items were subject to 5% VAT. Following the end of the transition period the UK is no longer bound by the EU VAT Directive which mandates a minimum 5% rate of VAT on all sanitary products.
The VAT charge on sanitary products became widely known as the 'Tampon Tax' has therefore been abolished from 1 January 2021. This measure had been announced in the Spring Budget 2020 and honours a government commitment to scrap the tax as soon as was possible. This means that there will be no VAT whatsoever charged on women’s sanitary products.
This measure is part of a wider strategy to make sanitary products affordable and available for all women which includes:
- January 2020 roll out of free period products for all young people in English state schools and colleges and extension of the scheme into 2021
- the NHS offering period products to every hospital patient who needs them (including long-term in-patients) since 2019
- the Tampon Tax Fund, established in 2015, which allocated the funds generated from VAT on period products to projects supporting vulnerable and excluded women and girls
The Tampon Tax Fund will continue to provide funding for projects supporting vulnerable women and girls.