Senator Pia Cayetano brought a bit of good news to the public: The exemption of several life-saving medicines and maintenance drugs from the 12 percent value-added tax (VAT) under the Corporate Recovery and Tax Incentives for Enterprises, or CREATE Law (Republic Act No. 11534).
Cayetano shared the positive development with local government executives and members of the media during her visit to the city of San Fernando, Pampanga recently.
Under the CREATE Law, Section 109 of the National Internal Revenue Code (NIRC) was amended to exempt from VAT the sale or importation of prescription drugs and medicines for the following ailments: cancer, hypertension, high cholesterol, diabetes, mental illness, tuberculosis, and kidney disease.
The VAT exemptions were recently affirmed by the Bureau of Internal Revenue (BIR) through its Revenue Memorandum Circular No. 73-2023 issued on June 30, 2023.
“I am very happy kasi under the CREATE Law, isa sa pangunahing pakay nun is babaan ang tax ng mga korporasyon,” shared the veteran legislator who sponsored the landmark law that substantially lowered corporate income tax rates, and modernized the country’s fiscal and tax incentives system.
‘Yung mga mag-iinvest dito, whether it’s a Filipino or foreign group, mas mababa na ang tax nila. So may incentive ang companies para mag-invest.”
“So ‘yung mga mag-iinvest dito, whether it’s a Filipino or foreign group, mas mababa na ang tax nila. So may incentive ang companies para mag-invest, right?” the seasoned lawmaker added.
“But minsan, hindi rin kaagad ‘yan nararamdaman ng tao, dahil siguro, company ang unang nakikinabang. Pero syempre ang desire natin is ‘yung company magbibigay din sa employees n’ya ng benefits,” the lady senator continued.
“Mayroon tayong provision doon na tinanggal natin ang VAT sa mga gamot para sa madalas na sakit ng tao.”
“But in that same law, mayroon tayong provision doon na tinanggal natin ang VAT sa mga gamot para sa madalas na sakit ng tao. And that one, directly ‘yan na mararamdaman ng tao. Dahil kapag bumili ka ng gamot, gaya sa cancer, hypertension, high cholesterol, diabetes, mental illness, tuberculosis, and kidney disease…makikita mo doon na less VAT ang presyo, which is 12 percent. Less na yung babayaran,” she explained.
“So I am happy na makita na na-iimplement ang batas na inisponsor ko,” remarked Cayetano, who defended the measure from 2019 through 2020 as chairperson of the Senate Ways and Means Committee in the 18th Congress.
