China Cuts VAT on Cancer Medication
11 June 2018
In a bid to nurture the development of the cancer treatment industry and to reduce the financial burden on patients requiring anti-cancer medication, new regulations relating to the application of VAT within the sector have been issued by the General Administration of Customs, the State Administration of Taxation and two other government departments.
These new regulations, outlined in the Circular on Value-Added Tax (VAT) Policies for Cancer Drugs, contain three significant changes:
- Starting from 1 May this year, companies that manufacture, sell, wholesale or retail cancer drugs and that currently pay VAT at the standard rate, may opt to pay at a rate of 3% calculated under the stipulated simplified calculation method. Once a business has adopted the simplified tax calculation method, it will not be permitted to shift to another tariff-determining system for a minimum period of three years.
- All imported anti-cancer medication will be subject to a reduced 3% rate of import VAT from 1 May this year.
- The sales value of anti-cancer drugs shall, at all times, be calculated separately. The specified simplified method of calculating VAT will not apply in all instances where the sales value has not been calculated separately
For further details (in Chinese), please visit the following link:
- Medical Supplies & Medicine