A Reasonable Approximation

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How the UK taxes periods

Content note: politics, gender politics.

For a while I've been vaguely aware of a petition to "stop taxing periods. Period." I didn't pay it much attention until today, but now I've looked at it and done way more research than I expected to.

According to the petition,

A 5 per cent tax rate has been placed on sanitary products, while exotic meats walk tax-free. HM Revenue and Customs justified this tax by classifying sanitary products as "non-essential, luxury" items.

At least the first sentence of this is true. Sanitary products have VAT of 5% imposed on them. Exotic meats (including horse, ostrich, crocodile and kangaroo) do not.

Sanitary products are covered by VAT notice 701/18, which reduces the rate on them from the standard rate (currently 20%) to 5%. It applies only to "any sanitary protection product that is designed and marketed solely for the absorption or collection of menstrual flow or lochia (discharge from the womb following childbirth)". That is, this reduction was introduced specifically to reduce tax on sanitary products.

Exotic meats are covered by 701/14, which covers food in general. Most food is zero-rated. There are further exceptions for some things, including chocolate covered biscuits (but not chocolate chip biscuits), which are standard-rated; exotic meats are not one of those things. What seems to have happened here is that the government decided that most food should be zero-rated, and then made a list of foods that shouldn't, and exotic meats didn't happen to make it on to the second list for whatever reason.

I'm less sure about the second sentence, HM Revenue and Customs justified this tax by classifying sanitary products as "non-essential, luxury" items. More from the petition:

After the UK joined the Common Market in 1973, a 17.5% sanitary tax was introduced. It was justified when Parliament classified sanitary products as "non-essential, luxury" items.

I don't think this is true, but I think I can see how the story could have been chinese-whispered into existence:

  1. When the UK joined the Common Market in 1973, we introduced VAT. The standard rate of VAT used to be 17.5%.
  2. My current belief is that until 2000 or 2001, sanitary products were standard-rated. It's not that there was a specific "sanitary tax", but VAT was a tax that applied to sanitary products.
  3. It seems to be widely assumed that VAT exemptions are given to essential items, and not to others. Since sanitary products were standard-rated, they must not have been considered essential, so they must have been considered luxury.

But: In 1973, the standard rate of VAT was 10%. I'd be very surprised if sanitary products were taxed at 17.5% in 1973.

VAT actually replaced purchase tax, which did only apply to luxury goods. So if sanitary products were taxed for the first time in 1973, it's because they weren't considered luxury.

Putting "non-essential, luxury" in quotes would seem to imply that this is a direct quote from something, but the first page of google results for that page all seems to be inspired by the petition at hand. The second page has nothing helpful, the third is back to this petition. I haven't found a source for this phrase.

In fact, I haven't found any official source that suggests that the government thinks sanitary products are non-essential. The evidence for this seems to be purely the fact that they have 5% VAT imposed on them.

But this assumes that VAT is not applied to essential products, which as far as I can tell just isn't true. Here is the entirety of the official-seeming evidence I've found which connects essential-ness to VAT status: a page on gov.uk which says "You pay 20% VAT most of the time - but less on essential items."

One reading of this is that all essential items, and only essential items, are taxed at less than 20%. By this reading, sanitary products are essential, being taxed at 5%.

On the other hand, when you look at the list of VAT exemptions, it includes gambling and antiques, which seem pretty non-essential; and it doesn't include clothes for adults, which are pretty damn essential. (If I don't wear clothes, I will get locked up. I'm forced to pay tax on the clothes that I'm forced to wear. This is almost Kafkaesque, in a really really minor way.)

Just in the healthcare genre, it doesn't include toothpaste or dental floss, most glasses or hearing aids, sticking plasters, paracetamol, or the creams I use for acne and eczema. (I haven't specifically researched most of these. I think I've looked in the places where I would find them if they were covered, but it's possible I've made a mistake.)

It does seem that most of the things in that list are things that most people think should be easily accessible. But if I showed someone that list without telling them what it was, I don't think they'd say "this is a list of things which are essential".

Wikipedia also doesn't use the word "essential".

If we ignore that one linked page, it just doesn't seem like the government classifies things as essential or not, and then assigns them a VAT status based on that classification. It just assigns VAT status. To ask whether the government considers something "essential" seems to be asking a null question. That's not a word that the government, as a body, knows.

There is still that one linked page, but currently I'm dismissing it as an anomaly. Gov.uk is intended to be accessible and accurate, and in this case I suspect that accessibility triumphed over accuracy, and/or someone just made a mistake while writing it.

I worry that I'm simply ignoring contarary evidence here, but consider: the government publishes a list of things. It doesn't put things on the list just for being essential, or deny them from the list for being nonessential. It doesn't correlate very well with what most people would consider essential. I can only find one place where the government comes close to describing it as a list of essential things, and that's in a descriptive context, not a binding one.

If it doesn't look like a duck, quack like a duck, or fly like a duck…

So. In 1973, the government probably did not consider sanitary products to be "non-essential, luxury" items. It just considered them to be things, and it taxed them the same as it taxed most things.

Since 2001, the government almost certainly doesn't consider sanitary products to be non-essential. It taxes them at a reduced rate compared to almost everything else, but at a higher rate than some other things.

Under EU law, the government isn't allowed to zero-rate them. We have other zero-rated things, but they were zero-rated before we joined the EU. The VAT on sanitary products is as low as it is permitted to be.

We might (or, quite likely, might not) be able to exempt sanitary products instead of zero-rating them. But there's an important difference. If you buy raw materials, produce a product, sell it, and have to pay VAT on the sale, then you can claim back the VAT that your supplier paid on the materials. If you don't pay VAT on the sale, you can't claim back that VAT. If sanitary products were exempt rather than not zero-rated, the selling price might (or might not) go up because of this, depending on the cost of raw materials. It's almost certainly more complicated than this, but:

Suppose you buy £30 worth of cloth, of which £6 is VAT. You make a lot of tampons and sell them for £100. You have to pay £5 VAT on that sale, and can claim back the £6 VAT you paid on the cloth. Profit: £100 - £30 - £5 + £6 = £71. If tampons were VAT exempt, you'd need to sell them for £101 to make the same profit.

(The past two paragraphs were written from the perspective that the seller pays VAT. Mostly we seem to talk about the buyer paying VAT. It's all equivalent, but I hope I wasn't too confusing.)


Having established (what I believe to be) the facts, here are my thoughts on the petition itself:

Firstly, it doesn't strike me as a particularly big deal.

Financially, we're talking about £150 a lifetime lost to taxation on sanitary products, assuming £5/month for 50 years. I don't think anyone is claiming it's a particularly heavy burden, it's not about money.

From a gender-politics perspective… it also just doesn't seem like a big deal. If sanitary products were still standard-rated, I could maybe kind of get behind this, even though I don't actually think that standard-rated implies non-essential. But they're at the lowest VAT rate the UK government is allowed to put them at. I just don't see this as a sign that we value crocodile meat more than female participation; or of male-focused agenda setting; or any form of institutional misogyny.

It seems like most of the conversation is fueled by outrage. I don't think there's much here to be outraged about, and I would prefer that the energy being put into this outrage goes elsewhere.

Secondly, I don't really like the tactic of petitioning the UK government over this. The petition acknowledges that they can't do anything under current EU law. So the goal is to get the UK to get the EU to change its laws.

That seems… really unfair. I don't think I can argue clearly and succinctly for that position, which usually means I should spend more time clarifying my thoughts to myself. Instead of doing that, I'm going to argue by analogy. I don't think these analogies are the same in every way, or even in every relevant way; they just seem to me to have some structural similarities to the case at hand.

So, suppose I notice that I've been overcharged on my phone bill. I call up the company, and the customer service rep is very polite and helpful and refunds me. I tell her, "that's not good enough, I also want to be refunded for the price of this phone call to you, that I shouldn't have had to make". She tells me that she simply doesn't have the power to do that. So I tell her that she needs to complain to her managers until they give her that power, and I'm going to keep calling her every day until she can refund me for the cost of this phone call.

This isn't her battle. She's sympathetic to my plight, but she has other priorities. And I'm blackmailing her into fighting for me.

This feels kind of like that kind of power dynamic.

Or: "hey man, I just need 20p for my bus fair, can you help?" "Sorry, I'd like to, but I have nothing smaller than a tenner." "So give me a tenner, don't be a tightass."

There's only so far that you can expect someone to go for you, and I feel like this petition is asking for more than that.

Posted on 22 February 2015

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