Sanitary Pads

An ‘unhealthy’ tax regime: Is the Govt. stifling basic needs?

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In this weekly column on The Sunday Morning Business titled “The Coordination Problem”, the scholars and fellows associated with Advocata attempt to explore issues around economics, public policy, the institutions that govern them and their impact on our lives and society.

Originally appeared on The Morning


By Anuki Premachandra

This year’s global theme for World Health Day, which falls today, is universal health coverage (UCH) for all. In comparison to most countries in the region, Sri Lanka is in a positive trajectory towards this, with a policy goal to ensure universal health coverage to all citizens through a well-integrated, comprehensive health service.

UHC is a health care system focused on medical service delivery – it predominantly revolves around accessibility, affordability, and availability of healthcare services. However, in the case of Sri Lanka, health needs to be looked at from a broader perspective.
This World Health Day, while commending the country on a great public healthcare system and better access to water and sanitation than most other countries in the region, I’m going to explore the case of how some simple taxes on items that contribute to your health can lead to complicated concerns on your health. Are Sri Lanka’s tax policies depriving you of accessibility, affordability, and availability of proper healthcare, hygiene, and sanitation?

Taxing your menstrual health
Menstrual hygiene is not commonly discussed in Sri Lanka, having very little literature and understanding of proper menstrual hygiene management. This is also probably a reason why a basic item required for proper menstrual hygiene – sanitary pads – have total taxes as high as 62.6% levied on them, despite being a country with 4.2 million menstruating women. More often than not, women are compelled to use unhealthy menstrual hygiene products or practices owing to their monetary conditions. Naturally, an intervention like taxes only worsens this situation. The most appalling of findings is that unhealthy menstrual practices can contribute to cervical cancer, one that unfortunately has proven to fall to the plight of many Sri Lankan women.

Every year, 1,136 women are diagnosed with cervical cancer and 643 die from this disease in Sri Lanka (HPV Centre, 2018). Cervical cancer ranks as the second most frequent cancer amongst women in the country, wherein poor menstrual hygiene management is a direct causal factor of this. Of our population, 52% is women, out of which 4.2 menstruating women stand the risk of being diagnosed with cervical cancer due to poor menstrual hygiene. If we are taxing something as necessary as sanitary napkins that contribute to healthy menstrual practise, are we not then making health a privilege instead of a basic human right?

Taxing your access to proper sanitation
In a recent interview, Senior Advisor at the Sri Lanka Water Partnership Kusum Athukorala stated that the main problem they have had to deal with when conducting sanitation programmes in rural schools is the lack of a proper disposal mechanism for sanitary pads. It is either this or the lack of proper toilet facilities. According to the WHO, although sanitation coverage in Sri Lanka is 92% – the best in the South Asian region – an area that they too have identified as one that requires further development is rural school sanitation. Period-friendly toilets matter.

Additionally, although over 50% of our population have access to household sanitation facilities, diving deeper into the breakdown of these numbers is important. Despite great sanitation coverage, 7.2% of our urban population, 7.6% of our rural population, and 17% of our estate population still rely on a shared toilet facility for their sanitation needs, according to the Household Income and Expenditure Survey 2016. Why then do our rural schools lack proper toilets and why does a portion of our population rely on shared toilets for their sanitation needs? The answer lies in the prohibitively high cost of building toilets.

Total import taxes on sanitary ware like commodes and squatting pans are over 60% and wall tiles, floor tiles, and finishing ceramic are taxed at over 100%. Out of our population, one million people live in temporary houses and 1.2 million people live in underserved settlements. Access to proper toilet and hygiene facilities are very limited in these types of households owing to the exorbitant cost of constructing one. Having access to sanitation is a basic human right, yet a portion of our population suffer on a daily basis from the lack of access to a clean and functioning toilet. Without toilets, untreated human waste can impact a whole community, affecting many aspects of daily life, and ultimately pose a serious risk to health. The issue runs deeper into societal impacts, such as teenage girls often leaving school at the onset of menstruation due to lack of privacy and the risk of contaminating infections due to unhygienic toilet facilities. This narrative needs to change.

An ‘unhealthy’ tax regime

This World Health Day, while we commit our country to global goals that provision for more accessible and affordable healthcare facilities for all, let’s also look at health in a broader perspective. In Sri Lanka, universal health coverage can be realised through affordability, accessibility, and availability of better health, sanitation, and hygiene facilities – end taxes on periods and toilets!


Anuki Premachandra is the Manager – Research Communications at the Advocata Institute. She has a background in public policy with an active involvement in policy communications. She is also an advocate for the reduction of the period tax and contributes to research and policy work in that subject area. If you have any questions or feedback on this article, she could be contacted on anuki@advocata.org or @anukipr on Twitter. Advocata is an independent policy think tank based in Colombo, Sri Lanka which conducts research, provide commentary, and hold events to promote sound policy ideas compatible with a free society in Sri Lanka.

The cost of being a Sri Lankan (woman)

Originally appeared on Sunday Observer

By Anuki Premachandra

Being a Sri Lankan woman is not easy. From having to constantly battle gender stereotypes and rebel gender roles, women also have to burden the financial cost of something that is beyond them; the exorbitant costs of sanitary pads and tampons. With a population that is 52% women, you’d think that we’d know better than to tax a woman’s necessity, but we don't.

Earlier this year, the Advocata Institute revealed some data and statistics on the import taxes on sanitary napkins, which were being taxed at a total of 101.2%. It was our Fellow, Deane Jayamanne who shed light on the absurdity of taxes on diapers and sanitary napkins, both practical necessities. This tax structure is not only a reflection of poor public policy, but also a testament to how little we’ve progressed as a society. Taxing a women’s necessity so heavily (it is treated as a luxury) does not reflect well on our policy choices, especially when our progressive neighbor, India recently scrapped a 12% GST (Goods and Services Tax) on sanitary towels.

A breakdown of the tax system is as follows:

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At least one could say that we know better now. On that revolutionary note, in a statement last week, the Finance Minister has stated that the CESS on sanitary pads will finally be removed. However, the issue of protective taxes is much larger than just this, and needs immediate attention.

HOW TAXES WORK

In Sri Lanka, a lot of our daily necessities, from food to household products are imported. This is true in the case of sanitary napkins and tampons as well. In an ideal sense, this should allow us to take advantage of global efficiencies to source the cheapest or best products, depending on what people want. Unfortunately high taxes and poor trade policies only end in driving up the price of these products in the market.

Some of the taxes generate revenue for the government but many are imposed to protect local industry. Tariff protection for local industry comes at a cost: high prices for consumers.

In textbook terms, higher prices of imports means that consumers switch to locally produced products, boosting local business. However, a ripple effect of import taxes is that local producers can now sell their products at high profit margins because the selling price of the competing imported product is raised by the taxes - this is unfortunately the case of sanitary towels and many other household products in Sri Lanka.

Our Resident fellow, Ravi Ratnasabapathy highlighted the absurdity of taxes on commonly used household products in his latest column on the Echelon Business Magazine. Import taxes for cereal adds up to 101%, fruit juices to 107%, noodles to 101%, aftershave to 120% , toothpaste to 107%, etc etc. The list continues.

Lifting the taxes on sanitary pads is a signal that as consumers and citizens, we still have hope. Hope, that government authorities realise the absurdity of taxing daily consumption. Sri Lankan’s are literally taxed to go about their daily lives, from the toothpaste you use to brush your teeth in the morning to the ingredients that go into your daily buth packet, our taxes are absurd.

Price protection for local industry is a blunt tool that hurts consumers and incubates inefficiency.

Government support for industry should be directed away from tariff protection towards efficiency improvements: to  upgrade technology, worker skills, improve access to capital, R&D and infrastructure.

These, together with more efficient government processes, improved infrastructure, more advanced research institutions-in short a healthier business environment; can yield long term productivity gains for the economy and the firm.