FG begins implementation of zero VAT, excise duties on pharmaceutical merchandise to crash costs
The Federal authorities has introduced the graduation of zero Value Added Tax (VAT) on pharmaceutical merchandise and medical units in a bid to scale back drug costs within the nation.
In a press release signed by the Head of Information within the Federal Ministry of Health, Alaba. R. Balogun, famous that the Executive Order on harmonised implementation framework has been cleared to be gazetted.
Furthermore, the Ministry famous that following the completion of the method, the Federal Inland Revenue Service (FIRS) and Nigeria Customs Service (NCS) can now start implementing zero VAT and excise duties on pharmaceutical merchandise and medical units.
It additionally said that native producers of pharmaceutical merchandise will now start to profit from the aid measures.
It said, “The Ministry of Health and Social Welfare is pleased to announce the finalization of the Executive Order Harmonized Implementation Framework, which has now been cleared for gazetting. This critical step ensures that the Federal Inland Revenue Service (FIRS) and the Nigeria Customs Service can proceed with the implementation of zero VAT and excise duties on pharmaceutical products and medical devices.”
“With the implementation of this Executive Order, we anticipate a notable reduction in the prices of essential pharmaceutical products and medical consumables. This development aligns with the Ministry’s unwavering commitment to reducing both the physical and financial pain faced by millions of Nigerians who depend on these critical health supplies.”
It was famous that the gazetting of the Harmonized Implementation Framework represented the conclusion of the third pillar of the Ministry’s 4-point agenda, which focuses on unlocking the healthcare worth chain.
Backstory
- Earlier in June 2024, President Tinubu signed 4 Executive Orders to implement zero tariffs, excise duties, and VAT on specialised equipment, gear, and pharmaceutical uncooked supplies as a way to improve native manufacturing of important healthcare merchandise.
- The initiative was focused at prescription drugs, diagnostics, medical units like needles and syringes, biologicals, and medical textiles, aiming to considerably strengthen Nigeria’s healthcare worth chain.
- Then the Minister of Health and Social Welfare, Prof. Muhammed Pate famous that the orders will assist scale back drug costs throughout the nation.
Rising drug costs in Nigeria
Following the exit of main pharmaceutical producers like GSK and Sanofi from Nigeria and the depreciation of the Naira, the costs of medicine skyrocketed throughout the nation. This made healthcare costly for a lot of Nigerians particularly probably the most susceptible.
Nairametrics earlier reported that the costs of medicine equivalent to ventolin inhalers, Augmentin and others spiked by nearly 1000% final yr following the exit of GSK.
