University of the Witwatersrand (Wits) students made the news last week with their call for an end to the so-called tampon tax. In South Africa sanitary wear is taxed. Value added tax (VAT) is charged on these goods, as with other goods classified as luxury and/or non-essential goods. There are several goods and services that are exempt for VAT or zero-rated for tax (see below), however, tampons, pads and other sanitary wear that women require are not included in this.
There have been calls for the taxing of these items to cease as they are a necessity for women during menstruation. South Africa is not the only country to tax these items. The United Kingdom, as well as parts of the United States and other countries around the world tax sanitary wear too. However, change is starting in the United States, where New York State passed a bill to put an end to its tampon tax last week.
Lil-Lets holding company Premier FMCG noted in a statement: “Premier FMCG is aware that discussions are taking place in the public domain around universal access to sanitary products. Various groups and individuals have raised affordability as a concern, especially amongst younger girls where lack of access may result in absence from school.
“Premier believes that meaningful discussions from an industry perspective should be driven by a relevant industry body to appropriately consider the issues raised by various groups and individuals. This would enable the industry body to partner with all the relevant role players such as Government, industry and various lobby groups to determine a desirable way forward.”
Tampon Tax
Highlighting the cost of sanitary wear for women, Amnesty International WITS posted the following statement on its Facebook page:
“Every month, millions of impoverished women and girls in South Africa are plunged into distress and crisis, on account of the simple fact that they cannot afford sanitary pads. They are forced to improvise - using everything from rags to paper to leaves - to try and stem the blood flow. Many girls miss school, while many more are forced to drop out altogether. Health is jeopardised, while dreams are destroyed. This is unacceptable. Amnesty International Wits is therefore embarking on a campaign to make sanitary pads freely available on campus, for the entire university community, including workers. We are also demanding an official reclassification of women's hygiene products as necessities on which no tax ought to be charged.”
Premier FMCG stated: “Lil-Lets understands what it means to be a woman in South Africa, and some of the challenges that women may experience when they have their period. Younger girls can often miss school because they fear the embarrassment and loss of dignity if they do not have the confidence and protection of a reliable feminine hygiene product.”
Premier FMCG added that since 2013 Lil-Lets has been a sponsor of Caring4Girls. This is a sanitary towels and menstrual hygiene programme aimed at helping underprivileged girls mainly in rural communities. According to Premier FMCG, to date products worth more than R5 million has been donated.
Charging VAT
According to the South Africa Revenue Service (SARS), VAT is based on destination consumption and is levied at 14%. That is, it is applied to the following:
- the supply of all goods or services made by any vendor in the course or furtherance of any enterprise carried on by that person
- the importation of any goods into South Africa by any person
- the supply of any “imported services” as defined in the VAT Act
Furthermore, SARS highlighted that “VAT must be included in the selling price of every taxable supply of goods or services made by a vendor in the course or furtherance of that vendor’s enterprise.”
However, there are certain goods that are exempt from VAT.
Goods exempted from tax
According to National Treasury, the below goods and services are zero-rated for tax:
- Exports
- 19 basic food items – brown bread, maize meal, samp, mealie rice, dried mealies, dried beans, lentils, pilchards/ sardinella in tins, milk powder, dairy powder blend, rice, vegetables, fruit, vegetable oil, milk, cultured milk, brown wheaten meal, eggs, edible legumes and pulses of leguminous plants
- Illuminating paraffin
- Goods which are subject to fuel levy (petrol and diesel)
- International transport services
- Farming inputs
- Sales of going concerns
- Certain grants by government
The below goods and services are exempted from VAT:
- Non-fee related financial services
- Educational services provided by an approved educational institution
- Residential rental accommodation
- Public road and rail transport