As a normal charge contraceptives have a VAT of 17.5% on them. This is expected to come down on condoms and other contraceptives in the ensuing budget.
Gordon Brown is due to present the budget later this month.
This was said by High Street chemist Superdrug which said that it was confident of the action. The VAT would come down to 5%. It said the move followed a successful 10-month campaign.
Superdrug managing director Euan Sutherland said: "We are delighted that the Treasury has heeded calls to make a change in the VAT rules. The VAT rules do not make sense and this is just the first of a series of challenges we will mount to ensure our customers don't pay luxury tax on the items we know are real essentials."
It comes after 69 MPs signed an Early Day Motion in support of the campaign and a petition signed by 20,000 Superdrug customers was delivered to the Treasury along with 9,000 condoms.
"Making condoms cheaper will obviously make them more accessible to more people. Sexually transmitted diseases and unplanned pregnancies are very high in the UK already so anything that can help make condoms and emergency contraceptives more accessible is welcome," said a family planning association spokesperson.
Reported cases of HIV and other sexually transmitted diseases are also on the rise. Therefore this action could encourage people to use them and save millions from STD's.