There have been several reports in the media in recent months suggesting that the government is to add VAT to cosmetic surgery procedures. If this is true patients will be charged an extra 20% on the procedures that they undergo. However, the picture is even more worrying for the NHS which, under certain circumstances, offers cosmetic surgery for free. If the VAT rumours are true then the NHS will find itself under financial pressure at a time when it can ill afford to be so. In this article we will look in depth at the government proposals on taxing cosmetic procedures and their effect on the NHS. We will then decipher whether the NHS will ultimately be forced to review their qualification for candidates undergoing cosmetic surgery.
HM Revenues and Customs
In autumn 2011 HM Revenues and Customs stated that they wanted to clarify the existing legislation on which types of cosmetic surgery attract VAT. They claim that any cosmetic surgery carried out for medical reasons is not taxable. However, surgery simply carried out to improve appearance should be taxed. The department said this had always been the case and new legislation had not actually been introduced. Cosmetic surgeries disagreed arguing that this tax had never been enforced so if it was now suddenly going to be enforced law it was, in effect, a new law. However, the boundaries between cosmetic surgery for medical and aesthetic reasons are not always as easy to define as, say the difference between rhinoplasty surgery to help alleviate problems with breathing and liposuction to tackle a pesky “muffin top”.
A surgeon could argue that a female requesting breast enlargement surgery needs it to combat depression, a medical condition. Breast enlargement would traditionally be seen as an aesthetical procedure but in this instance it may be passed as medical. Indeed, HM Revenues and Customs admit that each case needs to be judged on its individual merits.
So where does this leave the NHS?
Under current guideless the NHS only offers cosmetic surgery when it is deemed medically necessary. Therefore, the new legislation on VAT has no impact on the NHS. The health service will not have to foot additional bills whilst they continue to offer medical cosmetic procedures. It seems the NHS will have no reason to review their qualification of candidates for cosmetic procedures. In fact there are less likely to do so as any review may lead to non-medical procedures being carried out which would result in the service incurring the VAT charge.
There remains much confusion over the proposal of adding VAT to cosmetic procedures. The government themselves claim that some procedures are, and also have been, taxable. They claim they have not changed their policy but are simply clarifying the existing rules. It is clear, however, that the majority of cosmetic surgeries have not been charging their clients VAT for any procedures and the law has not been enforced. The outcry in the cosmetic industry reflects the panic felt by surgeons who worry potential patients may desert the UK for cheaper surgery abroad. The NHS, however, remains unaffected by this change or clarification because all the procedures carried out by the health service are for medical purposes so they will never attract VAT. It remains to be seen whether the government enforces the VAT on some cosmetic procedures but it is clear that the NHS will not be affected and therefore is under no pressure to review its candidates for surgery.