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What you’ll save from axing the tampon tax

The tampon tax looks set to be abolished if the federal government wins support from the states and territories. But what how much will
Bianca Hartge-Hazelman
August 6, 2018

Australian women could save between $10 and $40 a year now that the federal government has bowed to pressure to remove the country’s “tampon tax” from female sanitary products.

The amount isn’t a lot but if (like me) you have more than one little or big women in your household, then you know the cost is going to add up.

But this really isn’t about economics, axing the tampon tax is a matter of principle and it just so happens that a federal election is looming.

“If razors are excluded from GST then so too should women’s hygiene products,” says Bob Deutsch senior tax counsel at the Tax Institute.

“We accept that on a per head basis that the saving for women will be modest but given that a lot of women are low income earners, this will be a bonus for them,” he said.

In just one month many women buy three feminine products at $5 to $10 a pack, so a 10 per cent tax is an unnecessary cost for about 5.6 million people – women, the men that shop for them, and those who can least afford it.

It’s estimated there are at least 85,000 women, who are homeless or living in poverty, who cannot afford to buy women’s sanitary products.

These women will often use rolled up toilet paper, rags or stay at home when they have their periods, according to the charity Share the Dignity.

After 17 years of public campaigning since the GST was introduced, Treasurer Scott Morrison announced over the weekend that the federal government would remove the tax on tampons if it gets the unanimous support of state and territory governments.

The move is a modest diversion for the government on tax and women’s issues, as it campaigns to push through a reduction in company tax rates, as promised in the May Budget.

Earlier this year, Bill Shorten claimed headlines and social media hashtags on popular women’s websites after he pledged that Labor would support a Greens Bill to abolish the tampon tax.

Australia has some global-image ground to make up on the controversial tax.

Just last month, India announced it would scrap a 12 per cent tax on women’s tampons and sanitary products as part of significant reforms to bring the fast-growing nation under the umbrella of a single tax system.

The GST is currently applied to tampons and sanitary products on the basis that these items are a luxury-spend, while GST is not applied to condoms or Viagra as these are deemed essential health items.

Speaking at a media conference, the Treasurer said: “I think [tampon tax] it’s an anomaly that has been built into the system for a long time and the states have decided to hold on to the money instead of getting rid of it.”

Liberal senator Amanda Stoker has previously said the GST on sanitary products cost women about $11 a year, and was a stretch for only a small number of women.

But according to Roy Morgan research, the cost is likely to be much more because Australia women don’t just stop at buying one packet of sanitary goods a month.

Women aged 14 to 54 make up around a third of the country’s population, and around two-thirds of them buy (and pay tax on) one or more of these products at least once in an average four weeks.

In fact one in 10 women buy up to three items from panty liners, tampons and pads.

Since the GST was introduced in 2001, the federal government has collected $30-billion a year, or just over half a billion dollars in total revenue over the entire period thanks to the sale of tampons.

If you consider that some women have been paying for sanitary items for the past 17 years that equates to between $170 and $680 per woman. Money we’d much rather keep.

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Bianca Hartge-Hazelman
August 6, 2018
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