Budget 2020: Chancellor Rishi Sunak to scrap tampon tax from January 2021

The tampon tax is expected to be abolished in the budget
PA
Ellena Cruse7 March 2020

Tampon tax will be abolished in January 2021, the Chancellor is set to announce in this week's Budget.

Rishi Sunak is planning to announce that sanitary products will not be classed as luxury goods when the Brexit transition period ends at the close of the year.

Until now, EU law has prevented member states from reducing the rate below 5 per cent as the products were not classed as essential.

However, the Government plans to remove the VAT from January 1 next year, the first day the laws no longer apply to the UK.

Chancellor of the Exchequer Rishi Sunak is set to announce the move on Wednesday
REUTERS

The Treasury estimates the move will save the average woman nearly £40 over her lifetime, with a cut of 7p on a pack of 20 tampons and 5p on 12 pads.

While the EU has been working to give member states the ability to scrap the tax, successive UK governments have committed to abolish it.

Critics have long argued the tax led to “period poverty”, where sanitary products are pushed out of reach because of their cost.

The UK currently uses the revenues raised to fund charities that aid vulnerable women, with £62 million having been allocated since the scheme was launched in 2015.

Tesco has already reduced the price of products to help tackle period poverty
PA

Campaigners praised the news, with Laura Coryton, who started a petition to end tampon tax in 2016, saying she is delighted that it set to be scrapped four years later.

She said: "The Government have finally said that they will end tampon tax and they will announce this in their Budget, which is amazing and such a cause for celebration.

"So many people have been campaigning about this for generations and finally we are being listened to.

"But that doesn’t mean that the fight is over, we are still having to talk about tampon tax until the deadline that the Government has just set is reached in December 2020.

"And we won’t stop talking until supermarkets respond by lowering their prices but thank you all so much for campaign with us and we are really excited about it."​

Other campaigners also welcomed the move but raised concerns the Treasury is not planning to replace the Tampon Tax Fund with other investment.

The chief executive of the Women’s Resource Centre charity, Vivienne Hayes, said: “We are over the moon to learn of this news, tampons and sanitary towels were never luxury items and should never have been subject to VAT.

“Congratulations to all the women who campaigned so long for this ridiculous and unfair tax to be removed.

“We are concerned that the Tampon Tax Fund will now be abandoned by the Government and we hope to see a replacement fund for women’s health and support charities announced in the near future.”

They also urged Boris Johnson to go further and spend the £700 million they estimate has been raised during the tax’s lifetime to be paid back to women’s charities, with Ms Hayes saying: “Come on Prime Minister pay back the tampon tax.”

Mr Sunak was already facing some budgetary criticism over the delay to the long-awaited National Infrastructure Strategy.

The £100 billion investment tackling the climate crisis and boosting transport connectivity had been set to be published “alongside” the Budget.

But Whitehall sources were acknowledging it would now be delayed by a number of days or weeks.

Labour’s shadow chancellor John McDonnell said the hold up represented “absolute chaos” in Government.

“We are facing the threat of climate change and an economy at risk of recession. That’s why we desperately need an immediate start to large-scale infrastructure investment,” he said.

“Delaying implementation of investment is unacceptable.”

And National Infrastructure Commission chairman Sir John Armitt said they were “disappointed” at the delay, but expressed confidence that ministers remained committed to infrastructure investment.

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