Metro Manila (CNN Philippines, January 23) — Medicines used to treat cancer, tuberculosis, kidney issues, and mental illensses would be exempt from value-added tax in three years’ time.
The newly-signed Republic Act (RA) 11467 — the same law that imposes higher taxes on liquor and e-cigarettes — carried a provision that exempts the sale and importation of prescription drugs for these diseases from the 12 percent duty starting January 1, 2023.
The law also provided for VAT exemption for medicines for diabetes, high cholesterol, and hypertension starting January 1 this year. However, these have already been exempted from VAT collections since 2019 through an order issued by the Food and Drug Administration and the Bureau of Internal Revenue.
The reduction in the prices of medicines comes alongside the implementation of the Universal Health Care Act, which aims to offer a wider array of free medical services to all Filipinos. Additional revenues to be raised from higher alcohol and new e-cigarette taxes would fund the program, which has been rolled out starting 2020.
The Department of Health has been ordered to list approved drugs and medicines that would be exempted from VAT payments.
Last year, President Rodrigo Duterte signed RA 11215 creating a nationwide program to curb cancer incidence. He also enacted the Philippine Mental Health Law in June 2018 meant to provide better access to mental healthcare.
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