Lynn Boylan (Sinn Fein)
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Everyone of us became more aware of the issue of plastic pollution over the last number of years. This is not just because of the unsightly nature of it but because we are now very aware of the knock-on impacts plastics have on all manner of wildlife. When I worked on the EU single use plastic directive, we were told that period products are the fifth most common item found in marine litter and that on average a person who menstruates will use on average 150 kg of tampons, pads and applicators in their lifetime. However, the approach favoured by the EU was not to regulate the manufacturers. It was not to insist that as a bare minimum they print on the packet the amount of plastic contained in their products, which is on average 90% of the contents.Instead the EU wanted to impose an environmental tax on period products. I strongly resisted this. Why should women be made pay the cost of cleaning up what is an essential product to their everyday lives, while manufacturers make huge profits? The disposable period product industry is worth £265 million per year in Britain alone. The period product industry deliberately chose to push women into purchasing disposable products as it is a far better business model to have women come back every month rather than every couple of years, or in the case of menstrual cups, every five to ten years.

It is estimated that only 5% of the population are using reusable products. This is down to many factors, including a lack of awareness of their existence, which can be addressed through public awareness campaigns. A second factor in the lack of use of sustainable products is their low visibility. Supermarket shelves are dominated with disposables because it suits the manufacturers' business model and many have preferential contracts with supermarkets.

However, the biggest barrier to widespread uptake of sustainable period products is their cost. Reusables are not appropriate in many circumstances, especially for vulnerable groups such as women who are homeless or living in precarious situations without access to their own bathrooms. However, cost is preventing a large proportion of the menstruating population from accessing sustainable products. One simple measure that could be taken would be to reduce the VAT rate on those products.

Currently, standard period products are 0% VAT while reusable products such as period underwear and menstrual cups are 13.5%. I am aware that EU rules prevent us reducing the VAT to 0%. However, it is interesting that products relating to a normal bodily function that affects women are on a higher VAT rate than going to a restaurant or pub and a rate almost three times that of trading a greyhound. It shows a bizarre set of priorities when it comes to women's health and protection of the environment.

Even more disturbing is that incontinence pads are taxed at the highest rate of VAT, which has increased to 23% as of 1 March. The rate of VAT on incontinence products is yet another example of regressive tax that disproportionately affects women. Incontinence is not a luxury. It affects women far more than men. It is estimated that as many as one in five women over 40 is affected by some level of incontinence and up to 70% of expectant and new mothers are affected.

I ask for a commitment that incontinence pads and sustainable period products have their VAT levels reduced to the minimum level possible. What measures have been taken to change EU rules to provide for 0% VAT on all period and incontinence products? Can the Minister of State give me a commitment that the Government will consider rolling out a similar scheme to that in Scotland where free samples of reusable products were offered alongside a public awareness campaign.

Seán Fleming (Laois-Offaly, Fianna Fail)
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I thank the Senator for raising this important issue this morning. I listened carefully to everything she said. The Senator seems to be knowledgeable of VAT regulations in Ireland and the UK and I want to thank her for the excellent presentation of the case. However, as the Senator may be aware, Ireland is the only country in the EU that applies a 0% VAT rate to period products such as tampons and sanitary towels. This rate was applied in 1991 and we have been able to maintain this rate under the provisions of the VAT directive that allow for a 0% rate to be maintained if it applied in 1991. I am sure the Senator is aware of that.

A number of new products have come on the market since then, which have attracted a standard rate of VAT. The period poverty working group lead by the Department of Health as part of the national strategy for women and girls published a report on period poverty on 8 February 2021. It recommended a reduced VAT rate be applied to certain newer period products in circumstances in which a 0% VAT rate cannot be applied. It also recommended that Ireland continue negotiations at EU level to allow for a 0% VAT rate to apply to all period products.

I am pleased to say that following the passage of the Finance Bill, new period products in question have had a reduced VAT rate applied to them as of 1 January 2021. The VAT rate directive provides for the application of a reduced of VAT to such products in paragraph 3 of annexe 1. I understand that before introducing the change officials ensured that the reduced rate applying to newer period products would not risk the 0% VAT rate on tampons and sanitary towels, which are far more common, and have attracted the 0% rate because it applied in 1991 and that still holds. I can confirm that Ireland and a number of other EU member states are looking for greater flexibility in the VAT directive to allow a zero rate to be applied to these new period products. That is essentially where we are. These discussions are connected to a wider VAT rate debate. Any agreement on VAT rates must be agreed by every member state because it is a taxation issue. We are seeking greater flexibility on this. A number of other states are assisting but it will have to be agreed by every member state.

Lynn Boylan (Sinn Fein)
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I thank the Minister of State for his response. I welcome that he has confirmed Ireland is pushing at an EU level to change the VAT rules. However, there needs to be urgency on it given the level of plastic pollution and the fact that cost is a real barrier to accessing these products. I welcome the VAT rate was reduced but it is still higher than the 9% VAT rate on restaurants, pubs and the hospitality sector and three times higher than the rate for trading animals. Our priorities need to be reflected.

Regarding incontinence pads, it must be an oversight the fact they are in the luxury category. That should be addressed. Based on equivalent UK figures, there could be as many as 255,000 women affected by incontinence issues in this country. I imagine they do not see incontinence pads as a luxury on which a 23% VAT rate should be paid.

Seán Fleming (Laois-Offaly, Fianna Fail)
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I again thank the Senator. I will take on board, and take back to the Department of Finance, the issue of the luxury rate on incontinence pads. I know they can be a very heavy cost for many families. We all know, through our work as local public representatives, community nurses regularly provide substantial amounts of incontinence pads, through the HSE, to patients in their areas that require them. However, we all hear locally they can sometimes be rationed. Some people are provided with incontinence pads through the HSE.

Period products such as menstrual cups, pants and sponges, previously at the standard VAT rate, were reduced to 13.5% on 1 January 2021. The Senator rightly asked why they were not reduced to the 9% applied to the hospitality sector. People understand that the VAT reduction from 13.5% to 9% in the hospitality sector was a temporary response to support those facing serious economic difficulties due to Covid-19. It is only a temporary measure and the plan is that the rate will go back to 13.5%. It was strictly a Covid measure for those particular businesses.

It is important to note that the rate of VAT applied relates to the type of product rather than whether it is sustainable. That is a broad issue we will all have to raise at European level. This means that sustainable sanitary towels and more environmentally friendly tampons still have a zero rate applied to them. It is very important to say that. I reiterate that sustainable sanitary towels and more environmentally friendly tampons still have a zero rate applied to them.