Medicine Price To Drop By 30 Percent Due To Tax Removal

The cost of medicines is set to go down by 30 percent by March 1, 2018.

This is due to the removal of taxes from local and some imported pharmaceutical products as stated in the 2017 budget presented to parliament by Finance Minister Ken Ofori-Atta.

The Chairman of the Chamber of Pharmacy, Anthony Ameka, announced the reduction in an interview with Kasapa FM, an Accra-based private radio station.

He said the decision was arrived at a stakeholder meeting by players in the industry, including representatives of the National Health Insurance Authority, Ministry of Health, Ghana Health Service, World Health Organisation, Ghana Revenue Authority, Chamber of Pharmacy, Pharmaceutical Society of Ghana, Ministry of Trade and Industry, among others

“If we look at the 2017 budget the current minister of finance sent to parliament, there was a component of 17.5 percent VAT that had been removed from drugs and other finished products that are not produced in Ghana but are imported.

And so based on that the pharmaceutical industry met and decided to look at the prices of drugs in Ghana. So what we did was to hold a stakeholder forum where we decided that we could reduce the prices of drugs by 30 percent,” he said.

Mr Ameka added that the reduction in the prices of medicine formed part of steps being taken by stakeholder to make health insurance financially more sustainable in the country.

He mentioned that by the amendment of the law that was passed by the government on VAT in 2016, local manufactures do no pay taxes on equipment and raw materials for manufacturing.

“So it means that they have enjoyed the tax regime since 2015, and then they must show some reduction in their prices,” he added.

Mr Ameka explained that the prices can further be reduced if the priced charged on drugs by the Food & Drugs Board's are also reduced.

The 30 percent reduction is for all finished goods imported into the country that are not produced in Ghana, as well as those that are produced in Ghana.

By Jamila Akweley Okertchiri