Take VAT off crucial sanitary products

Value Added Tax should not be charged on women’s sanitary products, writes Pierre Heistein.

VAT should not be charged on female sanitary products. This is the view of Parliament’s portfolio committee of women and a view I strongly support.

VAT is added onto the final sales price of almost all products and services in South Africa. It’s an effective way for the government to collect tax revenue across the board – a universal 14 percent tax that does not change based on income or profit, industry or business structure. In the last financial year, the government collected R301 billion in VAT.

Not all goods are subject to VAT. A small list of products is exempt to ensure the government’s tax collection does not get between people and the things they need most. This list includes 19 basic food items such as brown bread, maize meal, beans, rice, vegetables and fruit. It also includes residential rentals, illuminating paraffin and public transport. Farming inputs and educational services are also exempt due to their importance to the economy.

By that criterion, are sanitary products a necessity? Absolutely. Are they of critical importance to the economy? There are strong arguments to suggest they are. In my personal opinion, dignity and health concerns are justification enough to strip sanitary products of their VAT burden, but let’s explore the other factors at play.

There are 3 million women of schoolgoing age in South Africa. Where women are not able to afford sanitary products they are forced to miss, on average, a week of school every month. This problem is also common among teachers.

Approximately 430 million disposable sanitary pads or tampons are needed in the country every month. Even if all women needing sanitary products were buying them at retail prices, the government would only earn R45 million a month in VAT. It’s petty cash compared with the government’s total budget, yet wavering this potential income could relieve an important burden for millions of South Africans.

Removing VAT is a step in the right direction, but even with the 14 percent relief, sanitary products will remain out of reach for a large portion of the population. To bridge this gap, Parliament’s portfolio committee of women is calling for free distribution of sanitary products to South Africa’s poorest consumers.

Free distribution

Free distribution of sanitary products doesn’t need to break the bank. Sanitary Sistas – a CSI initiative by the Business Women’s Association in the Western Cape – distributes sanitary packs to around 2 000 impoverished women every year. The packs include three sets of underwear and nine biodegradable sanitary towels that are washable and reusable for five years. They cost R350 each, but with support from private donors the organisation is able to distribute them for free.

In 2014, while attending the One Young World summit in Dublin, I met a young Rwandan called Sylvere Muvara. Sylvere is the business development manager of Sustainable Health Enterprises (SHE) – an organisation that is slashing the cost of female sanitary pads by producing them from the trunk fibre of banana plants. SHE provides local women with the equipment and education to produce the sanitary pads and helps them set up sustainable businesses to ensure effective distribution in their communities.

In Rwanda, 18 percent of girls and women miss out on school and work each year because they cannot afford sanitary products. The cost to gross domestic product is estimated at around $115m (R1.7bn) a year. While numbers can help to make a business case for the investment into alternative solutions or justify the loss of government revenue, the argument for accessible sanitary products is not about business.

Menstrual cycles and the discomfort and inconvenience they cause are universal to all women, yet discussing them on the public stage remains taboo leading to a perverse misrepresentation of how important sanitary products are.

Through compromise and creativity, expense does not need to be a barrier to universal access to sanitary products in South Africa. Premium products that add value through design and convenience will always exist. But just like the free distribution of condoms, a simple, functional form of sanitary product needs to be available, tax free and preferably free of charge, to all women in South Africa.

* Pierre Heistein is the convener of UCT’s Applied Economics for Smart Decision Making course. Follow him on Twitter @PierreHeistein.

** The views expressed here do not necessarily reflect those of Independent Media.

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