The Period Price Puzzle: Are Retailers Profiting from Tax Breaks?
Austria implemented a VAT exemption on tampons and sanitary pads on January 1st, 2026, aiming to alleviate financial burdens on women and improve access to essential hygiene products. However, a recent investigation reveals that not all retailers are passing on these savings to consumers, sparking outrage and calls for stricter regulations.
What the Data Reveals: A Mixed Bag of Price Adjustments
Market research conducted by the AK Oberösterreich (Upper Austrian Chamber of Labour) since February 2025, analyzing prices at major retailers like DM, Bipa, Müller, Spar, Billa, and Hofer, paints a concerning picture. While some retailers have demonstrably lowered prices, others have either maintained them or, shockingly, even increased them. This raises questions about fair pricing practices and the effectiveness of the tax exemption.
Retailer Price Performance: A Snapshot
- Spar: Reduced prices by an average of 10%, correctly reflecting the VAT removal. Notably, only one product saw a price increase during the observation period, which was subsequently reduced by 24.4% in January.
- DM: Implemented price reductions of 8.9% to 24% across observed products. A price increase was noted on one large pack of o.b. tampons in May 2025.
- Müller: Saw price decreases between 9.3% and 24% on most products, with only one item experiencing a price hike.
- Bipa: A significant outlier. Four out of eight observed products saw price increases in 2025. While temporary discounts were offered in December, prices were raised again in January, failing to reflect the VAT exemption.
- Billa: One product experienced a 5.3% price increase in November, followed by a 9% reduction in January. However, this only resulted in an overall price decrease of 4.2% compared to pre-increase levels. Full VAT exemption pass-through was only observed on two products.
- Rewe Germany: Maintained consistent pricing throughout the observation period, unlike its Austrian counterparts (Billa, Bipa).
- Hofer: No comparison possible as the observed products were discontinued in 2025.
Beyond Price Tags: The Broader Economic Impact
The failure of some retailers to pass on savings isn’t just a matter of consumer fairness; it has wider economic implications. The AK Oberösterreich argues that this undermines efforts to curb inflation, as the anticipated dampening effect of the tax reduction isn’t materializing. Andreas Stangl, President of the AK, emphasizes the need for stronger legal frameworks and enforcement powers for the Austrian Federal Competition Authority (BWB).
Pro Tip: Utilize price comparison platforms like preisrunter.at to track price fluctuations and identify the best deals on feminine hygiene products and other essential goods.
The Call for Stronger Regulation: Empowering the BWB
The AK proposes several key measures to address the issue:
- Transform BWB investigations into actionable enforcement, with the authority to impose penalties for anti-competitive behavior.
- Facilitate market access in concentrated sectors like grocery and drug retail to foster competition.
- Enable the BWB to recoup unlawful profits derived from anti-competitive practices.
- Improve the legal framework for price comparison platforms.
- Mandate large retailers to provide price and product data (name, EAN, quantity) via APIs for recognized platforms, with voluntary participation for smaller retailers.
Political Pressure Mounts: A Staatssekretärin Speaks Out
Ulrike Königsberger-Ludwig, Austria’s State Secretary for Health, Animal and Consumer Protection, publicly criticized Bipa on Facebook, stating, “Dear BIPA, this is not acceptable. Since January 1st, 2026, tampons and sanitary pads have been VAT-exempt in Austria. This was a deliberate decision – to financially relieve women and create fairer access to hygiene products. The government is foregoing revenue – so that products that many women need month after month finally become more affordable.” She highlighted the contrast between Bipa’s practices and those of Spar, DM, and Müller, which correctly passed on the tax savings.
Future Trends: Transparency and Consumer Empowerment
This situation in Austria foreshadows a growing trend: increased scrutiny of pricing practices, particularly for essential goods. Consumers are becoming more aware of “shrinkflation” (reducing product size while maintaining price) and other tactics used to mask price increases. Expect to see:
- Greater demand for price transparency: Consumers will increasingly demand clear and accessible pricing information.
- Expansion of price comparison tools: More sophisticated platforms will emerge, offering real-time price tracking and analysis.
- Increased regulatory oversight: Governments will likely strengthen consumer protection laws and empower regulatory bodies to enforce fair pricing practices.
- The rise of conscious consumerism: Consumers will actively support businesses that demonstrate ethical pricing and transparency.
FAQ: Addressing Your Concerns
- Why are prices not going down even with the VAT exemption? Some retailers are choosing not to pass on the savings, potentially to maintain profit margins.
- What can I do as a consumer? Compare prices using platforms like preisrunter.at and support retailers that offer fair pricing.
- What is the role of the BWB? The BWB is responsible for ensuring fair competition, but its current powers may be insufficient to address this issue effectively.
- Is this happening in other countries? Similar concerns have been raised in other European countries following the implementation of VAT reductions on feminine hygiene products.
What are your thoughts on this issue? Share your experiences and opinions in the comments below!
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