A copy of the report by the (UK) Tax Policy Associates is here. Some highlights:
5% VAT applied to tampons and other menstrual products until January 2021. Then, following the high-profile “tampon tax” campaign, it was abolished. Many expected that the benefit of the tax saving would go to women, in the form of reduced prices.
However, an analysis of ONS data by Tax Policy Associates demonstrates that the 5% VAT saving was not passed onto women. At least 80% of the saving was retained by retailers (and very possibly all of it).
The key piece of evidence is this chart showing price changes before and after the abolition of the “tampon tax” on 1 January 2021. Ignoring the large spike in December 2020, average prices after the change are only slightly lower than before the change. For reasons explained further below, this likely reflects normal market movements rather than the passing on of the VAT saving.
Read the full report here.
A related news article appears in the (UK) Daily Mail here.
