During the Brexit period, some kidswear indies have been hit with import VAT charges. This has prompted the Childrenswear Association to make members aware of the situation and to ask them to report any problems. In the UK, clothing and shoes for young children have been charged zero rate of VAT since 1973. However, there are certain exceptions to this rule.

A number of articles of fur are considered to be standard rated if they are made of non-fur material and designed for a child. They must also meet the other conditions of paragraph 1.3. Similarly, clothes in small sizes that are held out for sale as suitable for adults are standard rated. The maximum size for boys and girls is 90cm. Some garments, such as fleeced blankets with sleeves, are not considered to be designed for a child and therefore are not standard rated.

There are exceptions to this rule, including for school uniforms. These can be zero rated if the garments are designed to be unique for the school and are held out for sale. The standard VAT rate applies to school uniforms, but they are eligible for a relief based on the estimated size of the average child at the time of purchase.

The same applies to imported children’s clothing and footwear. According to HMRC, the same rate of VAT applies to imported children’s clothing and footwear as for domestic purchases. This has caused confusion amongst retailers, as some are worried that they may have to pay VAT on goods that were not purchased in the UK.

There is also an exemption for clothing for children under the age of seven. However, there is no official definition of the age. The size of a child is defined by the size of the average child on their 14th birthday. If a child is more than an inch taller than the average, they are taxable on the full standard VAT rate. Those who are on the taller side are often facing a big bill when it comes to school uniforms.

The UK Government has not ruled out the possibility of removing the ‘tall tax’ on children’s clothing in the future. The ‘tall tax’ was introduced in 1973. At the time, some parents complained that they were having to spend more than PS100 a year on the same clothes their children wore at school. While it is possible that the Government may decide to eliminate the VAT on children’s clothing, this will require EU agreement. It is also possible that the rate of VAT will change in the future.

Although it is possible to reduce the standard VAT rate, it has been pointed out that there is no legal basis for doing so. This is because the EU rules state that there must be a minimum standard VAT rate of 15%. The rate of VAT can be changed in the future, so there is no reason why the UK government cannot reduce it.