Czech Republic increases VAT on medicines

2010-01-08

On 1 January 2010, the Czech Republic increased the VAT rates on a number of goods and services, including medicines. The preferential VAT rate applicable to medicines, among other things, increased from 9% to 10%, whereas the basic VAT rate increased from 19% to 20%. The change was introduced by means of the so called “Janota’s package” adopted in 2009, which brought about a number of amendments to the Czech budget.
In addition to the changes to the VAT rates, the package – as we have reported on a few occasions in Central Europe Pharma News – also reduced the maximum manufacturer’s drug prices and reimbursement levels by 7% for a period of one year. The reduction applies to those medicines whose prices were not reviewed by the Czech medicines agency (SUKL) in 2008, when the country introduced a new reimbursement system.