The measure, part of the Budget Accompanying Act 2025 (Budgetbegleitgesetz 2025), was officially published in the Official Gazette on 30 June 2025 (BGBl. I 25/2025).

While the Act primarily aims to reduce Austria’s budget deficit, this VAT exemption represents a significant social and fiscal shift, acknowledging that products essential to reproductive and menstrual health should not be taxed as luxury items. Austria’s move reflects a broader European trend of using VAT policy as a lever for health equity, gender fairness, and cost-of-living relief.

A Growing European Trend

Austria is not alone in taking this step. Several other EU countries have already introduced similar VAT reforms on gender-specific or essential health products:

Ireland has long applied a 0% rate on tampons and sanitary pads.

France reduced the VAT rate on menstrual products from 20% to 5.5% in 2015.

Germany dropped its rate on feminine hygiene products from 19% to 7% in 2020.

Spain recently cut VAT on menstrual products and contraceptives from 10% to 4% in 2023.

Belgium eliminated VAT on menstrual products entirely from 2024.

These measures not only align with public health objectives, but also ease the financial burden on women and families. In some cases, such as Spain and Belgium, the VAT reductions formed part of broader cost-of-living packages during periods of inflation and economic strain.

Backed by EU VAT Reform

Austria’s reform was made possible by the EU Council’s 2022 amendments to the VAT Directive, which gave member states greater flexibility to set reduced or zero VAT rates on goods and services deemed essential. Under the revised rules, items such as healthcare products, menstrual hygiene items, and contraceptives may now be taxed at super-reduced or even zero rates, provided such treatment is extended equally to all EU citizens.

This greater autonomy marks a significant decentralisation of VAT policymaking, empowering countries to align their tax systems more closely with national policy goals and public sentiment. For Austria, the VAT exemption on women’s health products is both a symbolic and practical win, cutting costs for consumers while promoting equality and wellbeing.

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