Issue Two 2020
2020, Vol. 7, issue 2, (December)
Value added tax on medicines in EU countries
Value added tax (VAT) is calculated on each product, at each level, from manufacturer to retailer. Data show that in Bulgaria this tax for medicines is among the highest in the European Union – 20%. Only in Norway, Ireland, and Denmark the values are higher.
A zero rate exists in 10% of EU member states, namely Malta, the United Kingdom, and Sweden. If we look at the changes in VAT over the last 7 years, we will notice that in 4 member states values have decreased (in the Czech Republic from 15 to 10%, in Greece from 6.5 to 6%, in Iceland from 25.5 to 24%, and in Slovenia from 9.5 to 8.5%), and there has been no increase recorded in any member state. Research shows that 28 out of 34 countries in Europe have lower VAT on prescription drugs than Bulgaria.
It is imperative to take measures to reduce its value in Bulgaria. This is a necessary condition for improving both the economic and health status of our population. It will be helpful to introduce a differentiated VAT rate for medicines.
Keywords: value added tax, medicines, European Union