Sports Nutrition and VAT
By Simon Jurkiw


Up until now many sports nutrition products, such as whey protein, have been exempt from VAT. As of October 1st 2012, the Government has decided that all sports nutrition products will become standard rated. In laymanís terms, this means that sports nutrition companies will have to pay 20% of the sales price to the government. Many sports nutrition consumers have expressed concern as to how this may affect them. Below are the answers to some of the commonly asked questions:

Can anything be done to stop this?

No.

VAT will be imposed on sports nutrition products from October 1st.

Did anyone try to do anything about it?

Yes.

Circa 25 sports nutrition companies (including BulkPowders, Maximuscle, Reflex, PhD, Myprotein, GNC, etc) formed the UK Specialist Sports Nutrition Alliance. A number of steps were taken including: petitions, campaigning directly to MPs and meeting with HMRC (Revenue & Customs). Unfortunately it was to no avail.

Are all core sports nutrition products affected?

Yes.

Some products, such as fat burners, have always been subject to VAT. The main issue (if you perceive it as that) is that core products are now affected. Products such as Whey Protein, Protein Blends and All in Ones will be subject to VAT.

The exact terminology is: ďSports drinks that are advertised or marketed as products designed to enhance physical performance, accelerate recovery after exercise or build bulk, and other similar drinks...Ē Whey and Creatine are specifically mentioned, as examples, in HMRC guidance notes.

Does this mean that all sports nutrition companies will put up their prices by 20%?

Difficult to say.

Exactly what each sports nutrition company chooses to do is commercially sensitive; all will become clear on October 1st. However, it is fair to assume that there will be large price rises. Raw material prices, protein in particular, are seeing large increases. It is a fair assumption that few, if any, companies will be able to absorb a 20% loss on their key products.

Why canít sports nutrition companies take the 20% hit?

As mentioned above, protein prices are going up quarter by quarter (and are set to rise again). There isnít enough milk protein (particularly whey) to meet worldwide demand, so prices go up. For many companies, taking a 20% hit on what is already a very price sensitive product could see them go out of business.

Is it worth buying extra product prior to October 1st?

Yes.

If you use sports nutrition products, such as whey protein, it would be prudent to buy a little extra now. Itís impossible to say exactly how much your brand of choice will increase in price, but itís fair to assume it will increase. There are no immediate shelf life concerns with whey protein, so buying a little extra now will save you money in the long-term.