The Bureau of Internal Revenue (BIR) in the Philippines has expanded the list of medications exempted from value-added tax (VAT), further broadening access to critical treatments for various health conditions. This update includes drugs used for treating cancer, hypertension, mental illnesses, and high cholesterol.
In its latest revenue memorandum circular, the BIR approved the inclusion of 15 additional drugs under the Tax Reform for Acceleration and Inclusion (TRAIN) Law and the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act. The updated list was endorsed by the Food and Drug Administration (FDA).
The newly exempted medications consist of seven drugs for cancer treatment, five for hypertension, two for mental illnesses, and one for high cholesterol. These medicines are available in various forms, including capsules, tablets, lyophilized powder for intravenous infusion, concentrate, powder concentrate, solution for injection, oral solution, and syrup.
BIR Commissioner Romeo Lumagui emphasized the agency’s commitment to public service, stating, “The BIR is now a service-oriented agency, and this includes the regular update of medicines that qualify as VAT-exempt products.”
This recent expansion follows a similar update in March, when 20 medicines for cancer, hypertension, and mental illness were added to the VAT-exempt list.
The VAT exemption for prescription drugs began in January 2019, targeting medications for cardiovascular diseases and diabetes. These exemptions apply to sales by manufacturers, distributors, wholesalers, and retailers, with the goal of making essential medications more affordable for consumers.
According to data from the Philippine Statistics Authority, heart disease, cancer, and cerebrovascular disease were the top three causes of death in the country last year, accounting for 40% of total mortality. The VAT exemptions are part of the government’s ongoing efforts to alleviate the financial burden on patients and improve public health outcomes.
