The 10 per cent tax on tampons and pads will be removed in less than three months after states and territories unanimously agreed to exempt feminine hygiene products from the GST.
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After an 18-year public campaign which began when the GST was introduced in 2000, the consumption tax on women's products will be ditched from January 1.
The tax impost on sanitary items - which also extends to menstrual cups, maternity pads and leak-proof underwear - has long been described as unfair because products including condoms and Viagra are exempt.
Both major parties recently changed their policies to extend the exemption to feminine hygiene products.
Federal Minister for Women Kelly O'Dwyer says efforts to remove the tax have endured a "tortured history" and she is glad the time has finally come.
"We're really delighted that everyone's come on board to scrap what is an unfair tax," Ms O'Dwyer said on Wednesday.
"Millions of women right across the nation will be very thankful for it."
Shadow Treasurer Chris Bowen said the GST should never have been put on sanitary products in the first place.
"We welcome the fact that this discriminatory tax has been lifted," he told reporters in Sydney.
The move will cost states and territories $30 million in revenue per year, but Treasurer Josh Frydenberg says they are already making more money through GST being added to online purchases in July.
Greens senator Janet Rice said the move had come after 18 years of campaigning.
"People power has made it happen," she told reporters on Wednesday.
"The politicians have finally realised how much support in the community there has been to end the unfair and sexist tax."
Rochelle Courtenay, from homeless women's charity, Share the Dignity, is very pleased.
"We're really excited that this day has come ... where Australian women are not having to fight for what should be a human right," Ms Courtenay said.
State and territory treasurers backed the change during a meeting with federal Treasurer Josh Frydenberg in Melbourne on Wednesday.
Prime Minister Scott Morrison described the change as "a bit of common sense".
"It had always been our view that we wanted to see it changed," he told Perth radio station 6PR.
Australian Associated Press
