Alma Economics was commissioned by Melanoma Focus to estimate the financial and non-financial impact of applying a zero-rate VAT on 30+ SPF sunscreens. In particular, we conducted a quantitative analysis to assess the impact of VAT abolishment on:

• Skin cancer incidence and mortality;

• NHS cost savings associated with skin cancer treatment; and

• Lost tax revenue linked to the zero-rate VAT.

Our analysis used clinical and economic data, along with insights from the literature, to estimate: (i) the impact of VAT abolishment on the market price of sunscreens; (ii) the increase in sunscreen use following the expected decline in the market price of sunscreen; (iii) the reduction in skin cancer incidence and mortality resulting from the increased use of sunscreen; and (iv) the reduction in NHS treatment costs.

In addition, our analysis took into account the expected increase in skin cancer incidence due to (i) demographic changes, in line with projections provided by Cancer Research UK, and (ii) climate change, with a 0.2% annual increase supported by findings from the literature.

We estimated that approximately 2,800 cases of non-melanoma and 2,500 cases of melanoma cancer could be prevented in 2025 due to the increased use of sunscreen that would result from the abolishment of VAT. The public sector could save £128 million in NHS treatment costs, with a corresponding VAT revenue loss of £67 million. Projecting ahead to 2033, the net financial benefits for the public sector are expected to be over double the loss in tax revenue — £193 million vs. £79 million with a “Return on Investment” of £2.4.

➥ Find the full report here.