The European Business Association (EBA) has urged Ukraine's Verkhovna Rada to pass amendments to the Tax Code and create favorable conditions for improving the provision of healthcare institutions with affordable medicines and medical devices (bill No. 3180).
The EBA said in a press release that the adoption of the measure would help to settle the problems of cutting VAT on medicines and medical devices from 20% to 7%.
The association said that imposing 7% VAT instead of 20% depends what foreign activity code the customs office applies to the medical device.
“If another foreign activity code is applied to the medical device, it is impossible to impose 7% VAT. Now there is hope that the two problems will be solved: the Rada healthcare committee backs the adoption of bill No. 3180,” the EBA said.
“When the registration certificate for medicines expires, and the new certificate has not yet received, 7% VAT is not imposed on this medicine. Despite the fact that the expiration term of the medicine allows its sales and use by patients, pharmacies have to impose 20% VAT on it, or companies temporarily remove it from the shelves,” the association said.
The EBA said that the absence of the registration certificate could have various reasons linked to the re-registration procedure.
As for the situation with taxation of medical devices, the EBA said that 7% grace VAT is imposed to them if some foreign economic activities codes are applied.
“The rest of the devices have 20% VAT, but customs offices put the same device on the grace list differently in various days and moths,” the association said.
