BIR exempts more medicines from VAT
THE Bureau of Internal Revenue (BIR) announced that more medicines used to treat cancer and mental illness as well as maintaining hypertension have been included to the list of value-added tax (Vat)-exempt drugs.
According to the Revenue Memorandum Circular 23-2024 issued by the BIR on March 5, ten medicines for various diseases have been exempted from 12 percent VAT.
“The VAT exemption of these medicines for cancer, hypertension and mental illness is a step towards a healthier country. The BIR shares the noble intention behind more affordable medicines for the public,” BIR Commissioner Romeo D. Lumagui Jr. was quoted as saying in a statement released by the BIR last Thursday.
Medications for cancer such as Sonidegib (as phosphate), Pemetrexed (as disodium heptahydrate), Asciminib (as hydrochloride) and Palbociclib were added to the Vat-exempt list, based on the circular. Other anticancer drugs such as Pemetrexed (as disodium hemipentahydrate), Cabazitaxel and Entrectinib were also exempted.
Meanwhile, medicines for maintaining high blood pressure that were also Vat-exempt are Losartan Potassium + Amlodipine (as besilate) and Irbesartan + Amlodipine (as besilate).
Cariprazine with various dosage strengths, used to treat schizophrenia and bipolar mania, was also added to the list of Vat-exempt medicines for mental illnesses, according to the circular.
The circular applies to the sale or importation of drugs prescribed for cancer, mental illness, tuberculosis and kidney diseases by manufacturers, distributors, wholesalers and retailers.
The BIR said the circular was made in relation to the letter from the Food and Drug Administration (FDA) of the Department of Health on the updated list of Vat-exempt products under Republic Act (R A) 10963 (Tax Reform for Acceleration and Inclusion, or Train, law) and R A 11534 (Corporate Recovery and Tax Incentives for Enterprises Act, or Create, law).
The Create law provides VAT exemption to certain health products and medical devices where the FDA is directed to identify the products and transmit the list to the BIR. The circular is also pursuant to the Train law, according to the revenue collection agency.
The BIR said providing real-time updates to Filipinos concerning matters of taxation, including VAT exemption of certain medicines, is part of Lumagui’s “thrust for Excellent Taxpayer Service” tack for this year.