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Scrap the VAT: Why the public is suddenly taking an interest in consumption taxes

Ditch the VAT on exercise services to improve people’s health and save lives. That was our recent clarion call, when we examined how VAT could be a powerful tool in improving public outcomes.  It seems like more people are starting to recognise the power of VAT as a policy tool. 

Campaigning for VAT relief

Notably, after years of campaigning, the UK government finally did the sensible thing by addressing the ‘tampon tax’, as it is commonly known, and eliminating VAT on sanitary products. As the Guardian reports, campaigners are turning their attention to various critical items that should be zero rated because they contribute to the general good. 

SPF 30, VAT 0%

For example, activists want the VAT removed from sunscreen sold in the UK. And while sunscreen is big business, some campaigners argue that the revenue lost from zero rating sunscreen would be more than made up for by improved public health outcomes.  (At the time of writing, more than 1,000 people had signed the online petition to scrap sunscreen VAT.)

 Of course, when it comes to VAT, it’s not all or nothing. For example, car seats for children are subject to a reduced VAT rate of 5%. Some campaigners, however, say that car seats should not be subject to any VAT, as is the case with protective equipment such as bike helmets. 

Making travel more accessible

Concerned members of the public have also expressed concern about VAT on Covid tests. In cases where a negative Covid test is required for international travel, cutting VAT would, proponents say, make travel more accessible to the less affluent. 

Green VAT as a climate tool

Of course, climate change is one of the most pressing collective issues. Arguably, VAT has an important role to play in climate policy. 

Lawmakers and activists from the UK to Rwanda to Switzerland are wielding VAT as a potential environmental policy tool. 

Stay ahead of changing VAT regulations

VAT policy is nothing if not dynamic, subject to sudden changes in rates and regulations. Fortunately, Vatglobal’s cloud-based VAT compliance technology makes meeting your VAT obligations simple and easy, even as the compliance requirements change. Get in touch with Vatglobal for a simple solution to the complex problem of global VAT compliance. 

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