Wednesday, 13 August 2014

Mens sana

Jessica Valenti, a feminist blogger, argues in the Guardian that "feminine hygiene products should be free for all, all the time".  I respectfully disagree that the best way to help poor people get what they need is to subsidize supply of some goods to everyone, but that's not what I want to write about.

This is the bit that struck me:
Women in the UK are fighting to axe the 5% tax on tampons (it used to be taxed at 17.5%!), which are considered “luxuries” while men’s razors, for some baffling reason, are not.
It seems to imply that men's razors are VAT-free, which is simply not the case - they carry VAT at 20%.  There are three VAT rates in the UK, the standard rate of 20%, the reduced rate of 5%, and the 0% rate. And some items are VAT-exempt, which is not quite the same thing as being zero-rated.  HMRC has a list of goods and services in the non-standard categories: the list mentions sanitary protection but not razors, which therefore are taxed at the standard rate.

EU VAT policy is discussed quite readably in this UK parliamentary document.  In summary, the reduced rate of VAT applies only to items selected by the UK from an EU-specified menu, and the zero rate applies only to items which the UK zero-rated before the 1991 VAT harmonization - including food, books and newspapers, children's clothes and shoes, public transport, and drugs and medicines on prescription.  The European Commission would like to abolish zero rating, and likes to see its continuation, principally in the UK and Ireland, as a temporary measure.

The much less readable EU documentation is mainly in the 2006 VAT directive : Annex III has the list of items eligible for reduced-rate VAT, and includes "protects used for sanitary protection", but has nothing about shaving.  Title IX of the same document specifies what goods and services should be exempt from VAT.  Chapter 4 of the document, containing "Special provisions applying until the adoption of definitive arrangements", contains Article 110 "Member States which, at 1 January 1991, were granting exemptions with deductibility of the VAT paid at the preceding stage ... may continue to grant those exemptions" ("exemption with deductibility" means a 0% rate).

So where has Valenti, who, to be fair, is not European, got the idea that men's razors are zero rated?  Searching the internet suggests that it's something that UK feminists just know, perhaps because they've read it on the internet, mostly in comments on online forums. This website thunders "We’ve discovered that men’s razors do not carry any VAT at all.  Lowered to 0% in 2001, they became exempt from any VAT."  How can one discover something which is not just untrue, but legally impossible?  This ePetition simply notes that "men's razors are tax free".  This article ("men’s razors are not subject to tax") announces another online petition, these two articles link to the petition ("the list includes men's razors"), but the petition itself, while having fun with the zero-rated status of crocodile meat (which is zero-rated because it's a food), doesn't mention razors at all.  It seems that the authors of the petition discovered their mistake, and quietly deleted it.

Nowadays it's quick and easy to check facts online - anyone who, like me, has in the distant past spent hours in libraries searching for some minor piece of information marvels at what one can discover.  And yet the internet seems to be used much more to spread misinformation than to get things right.

Meanwhile, shouting at George Osborne about this is pointless: he doesn't have the power to change EU VAT law - that would require the agreement of all the EU governments.  And most of the EU governments would like to abolish zero-rating altogether.

1 comment:

  1. This topic have resurfaced May 2015. Widespread belief that mens' razors are free of VAT. They are not! Comparison with crocodile steaks, but meat is free, like chicken or beef. Distinction between "luxuries" and "essentials" is not in the UK or EU law. Long article in a magazine last week written by someone who has gleaned information, but clearly does not understand VAT.