Zero-rate all medicines under GST, government urged

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PETALING JAYA: The Pharmaceutical Association of Malaysia (PhAMA) has urged the government to categorise all medicines sold here as “zero rated” under the upcoming goods and services tax (GST).

If it fails to do so, it could incur at least RM195 million more on the cost of medicines, based on the assumption of a mere 5% increase in patient load in the government healthcare sector, following the implementation of the GST.

“There would be a rise of patient flow to the public healthcare sector, as most of the drugs are subject to the GST,” PhAMA president Yew Wei Tarng told reporters in a roundtable discussion on “Implication of implementation of 6% GST on medicines” yesterday.

Yew said that even though medicines under the National Essential Medicine List (NEML) are now zero-rated, some 70% to 75% of medicines registered under the Ministry of Health (MoH) will still be taxed.

“This would affect healthcare quality as most new and innovative drugs are still not listed under the NEML,” Yew told reporters at the discussion.

Under the GST, out of 12,000 medicines registered with the MoH, 2,900 are listed under the NEML and are zero-rated. According to Yew, the NEML is only revised every two to three years.

 

This article first appeared in The Edge Financial Daily, on March 4, 2015.