Recently, I took part in a heated discussion and I would like to hear your advice and opinion. A friend of mine berated the luxury tax on feminine hygiene products and I opposed him, saying that:

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1/ I wholeheartedly agree that feminine hygiene products - along with many other essential products like food and medication - should be excluded from taxation, but:

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2/ There is no such thing as a "luxury tax". The top VAT rate in UK is called "standard rate", followed by "reduced rate" and "zero rate". In Germany, it is called "Normal-Steuersatz" (normal rate). In the US it is called "statewide sales tax rate".

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3/ The real impact is negligible. Napkin calculation: A 34 pack of top brand (Always Ultra) sanitary pads in Tesco.co.uk is £2.70, of which £0.54 is VAT. The median disposable(!) income in UK in 2020 was £30,800 per annum. So the VAT on a pack of 34 top brand pads will cost you 0.02% of your monthly disposable income.

4/ Many other more or less essential products are subject to the highest taxation rate, including toothbrushes, toilet paper, shoes, electricity, etc.

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5/ I have argued that because of all those points above, calling the tax on feminine hygiene products a "luxury tax" is not warranted and is only done for ideological reasons.

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6/ The friend of mine argued that UK purchase tax was labeled luxury tax before - there is a notion of a luxury tax on UK VAT wikipedia, but it is unclear where the label comes from - and that "Non-luxury necessities" is the exact language of the US law. Do you know if that is really the case?