Starting Jan.1, medications for common diseases of Filipinos such as diabetes, hypertension and high cholesterol will be exempted from the 12 percent value added tax. Otherwise known as the Tax Reform for Acceleration and Inclusion (TRAIN) Act, RA 10963 provides that selected medication for diabetes, hypertension and high cholesterol will be exempted which be a great help and assistance to Filipinos who are suffering from this disease. This is also in addition to the existing 20-percent senior discount, since most Filipinos who have maintenance drugs belongs to this age group.
The government based from a study of Diabetes Center of the Philippines and Philippine Statistics Authority that an estimated of five million Filipinos will benefit from Republic Act No. 10963.
According to Revenue Regulation 25-2018 of the Bureau of Internal Revenue (BIR), the VAT exemption will apply only to the sale by manufacturers, distributors, wholesalers and retailers of the drugs and medicines prescribed for the treatment and/or prevention of diabetes, high cholesterol, and hypertension, but not to their importation. The Food and Drug Administration (FDA) will be expected to come out with a list of VATX exempt diabetes, high-cholesterol and hypertension drugs which the BIR would later issue as a circular and will be posted on their website. Meanwhile, other drugs not on the FDA list will still have VAT, the revenue agency said.
To ensure compliance and in and in line with invoicing requirements, BIR said the word “VAT-exempt”must be prominently printed on the receipt. Violators of any provision of the regulations shall, upon conviction for each act or omission, be punished with a fine of up to P 1,000.00 of a jail term of up to six months or both.
For complaints of non-compliance, consumers can report businesses to ecomplaints@bir.gov.ph. The Department of Health (DOH) said the VAT exemption on selected medications proves that the administration values the health of the general public.
With reports from: Philippine Daily Inquirer: Jovi Yee, Darryl John Esguerra, Ben de Vera.
Photos: Philippine Center for Diabetes Education Foundation,http://www.tarlaccity.gov.ph, gmanetwork
