Some history:
1940 - Purchase tax introduced, at 33 1/3%. Various exemptions provided, as well as lower rates for certain goods.
1969 - Purchase Tax (No 1) Order exempts incontinence pads from purchase tax
1973: Purchase tax replaced with VAT, at 10%, as a condition of the UK joining the EU. This was enacted by the 1972 Finance Act www.legislation.gov.uk/ukpga/1972/41/pdfs/ukpga_19720041_en.pdf
This provided for a zero rating on:
books, food, newspapers, water, fuel, construction of new buildings, transport, caravans, gold, banknotes, plus drugs, medicines and appliances supplied on prescription
And exemption for:
land, insurance, postal services, gambling, finance, education, health services, and burials + cremations
Incontinence pads are subject to VAT if not provided on prescription or by a hospital.
1973: Ireland also joins EU, introduces VAT
1974: higher rate of UK VAT introduced for some products
1977: VAT harmonization begins, with 77/388/EEC eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex:31977L0388. This provided that all goods and services would be subject to VAT in the EU, with the exception that there would be a transitional period where reduced/exemptions rates, for 'clearly defined social reasons' 'for the benefit of the final consumer' could be maintained, subject to five-yearly-review in order to aim to abolish them. This allowed the UK and Ireland, which are the only countries in the EU with zero rates, to continue with zero rates, as they already existed as of 31 December 1975
1979: higher rate of UK VAT abolished
1984: Ireland reduces VAT to zero on sanitary products www.irishstatutebook.ie/eli/1984/act/9/section/92/enacted/en/html
1992: 92/77/EEC eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex:31992L0077, requires a minimum VAT rate of 15%, except for a reduced VAT rate of AT LEAST 5%, which is allowed to be applied to a specified list of goods and services:
1 Foodstuffs (including beverages but excluding alcoholic beverages) for human and animal consumption; live animals, seeds, plants and ingredients normally intended for use in preparation of foodstuffs; products normally intended to be used to supplement or substitute foodstuffs
2 Water supplies
3 Pharmaceutical products of a kind normally used for health care, prevention of diseases and treatment for medical and veterinary purposes, including products used for contraception and sanitary protection
4 Medical equipment, aids and other appliances normally intended to alleviate or treat disability, for the exclusive personal use of the disabled, including the repair of such goods, and children's car seats
5 Transport of passengers and their accompanying luggage
6 Supply, including on loan by libraries, of books (including brochures, leaflets and similar printed matter, children's picture, drawing or colouring books, music printed or in manuscript, maps and hydrographic or similar charts), newspapers and periodicals, other than material wholly or substantially devoted to advertising matter
7 Admissions to shows, theatres, circuses, fairs, amusement parks, concerts, museums, zoos, cinemas, exhibitions and similar cultural events and facilities Reception of broadcasting services
8 Services supplied by or royalties due to writers, composers and performing artists
9 Supply, construction, renovation and alteration of housing provided as part of a social policy
10 Supplies of goods and services of a kind normally intended for use in agricultural production but excluding capital goods such as machinery or buildings
11 Accommodation provided by hotels and similar establishments including the provision of holiday accomodation [sic] and the letting of camping sites and caravan parks
12 Admission to sporting events
13 Use of sporting facilities
14 Supply of goods and services by organizations recognized as charities by Member States and engaged in welfare or social security work, insofar as these supplies are not exempt under Article 13
15 Services supplied by undertakers and cremation services, together with the supply of goods related thereto
16 Provision of medical and dental care as well as thermal treatment in so far as these services are not exempt under Article 13
17 Services supplied in connection with street cleaning, refuse collection and waste treatment, other than the supply of such services by bodies referred to in Article 4 (5)'
92/77/EEC provides that lower (i.e. zero) rates can continue to be maintained PROVIDED that the rate was in force prior to 1 January 1991, and continually existed since then.
1993 - Finance Act introduced new 8% VAT rate for domestic fuel, only
1997 - Finance Act by new Labour government cuts domestic fuel VAT to 5%, which was the minimum allowable under 92/77/EC
1998 - reduced rate of 5% made more general
2000 - reduced rate applied to sanitary products
So basically sanitary products are taxed at the lowest rate allowable, and the UK is not allowed to go any lower, otherwise they are liable to be taken to the European Court, where they WILL lose.
E.g., the Uk recently was defeated and forced to increase VAT from 5% to 20% on energy-saving materials (a measure introduced only in 1998). And if they reduce VAT from 5% to 0 on sanitary products, they will certainly lose.
The average EU rate on sanitary products is 17%. Only Ireland has zero, this is because it reduced the rate to zero before 1991 (in 1984).