Which of the following is an example of an item that is exempt from VAT?

Health services are indeed an example of an item that is exempt from VAT. In the context of VAT regulations, certain services and goods are classified as exempt to support public welfare. Health services, provided by hospitals, clinics, and other healthcare entities, are designed to ensure access to essential medical care, promoting public health without the additional charge of value-added tax, which can make such services less accessible to those in need.

While the other options may have specific VAT treatments or could fall into zero-rated categories (like children's clothes, which are zero-rated but not exempt), health services are categorized strictly as exempt from VAT. This classification helps to reduce the overall cost of healthcare services for patients and ensure that healthcare remains affordable and accessible.