With effect from 1 January 2026, value-added tax will no longer be applied to certain sanitary products and contraceptives. The new regulation was adopted as part of the Budget Accompanying Act 2025.
Previously, sanitary products such as tampons, sanitary towels, liners and menstrual cups were subject to VAT at a reduced rate of 10%. From 2026 onwards, these goods will become fully exempt from the tax. The same applies to a number of contraceptives.
The measure aims to lower the financial burden on consumers and facilitate access to health and feminine hygiene products.
Retailers are required to adapt their inventory management systems to ensure that these product groups are zero-rated for VAT.
The Austrian Federal Competition Authority (AFCA) may initiate a sector inquiry if circumstances suggest that the tax reduction is not being passed on.
Sector inquiries
General inquiries into a business sector (sector inquiries) may be conducted by the AFCA where circumstances suggest that competition is being restricted or distorted in that business sector. Since 2024, in accordance with § 2 para. 1 no. 6 of the Competition Act, the AFCA has also been entitled to conduct general inquiries into a business sector where circumstances suggest that a tax reduction is not being passed on, in breach of § 7 of the Price Act. VAT exemption is considered to be a tax reduction in this context.