The Financial Express

Beximco seeks VAT waiver on import of Covid-19 vaccines

| Updated: January 26, 2021 18:16:44

Evaly and Fianancial Express Mobile Evaly and Fianancial Express Desktop
- Picture used for illustrative purpose - Picture used for illustrative purpose

Beximco Pharmaceuticals Limited has sought exemption from the payment of Value Added Tax (VAT) on the import of COVID-19 vaccine, its administration and distribution to supply to the consumers at affordable prices.

As per the existing VAT law, the consumption tax at a rate of 15 per cent is applicable to all type of services.

Some 5.0 million doses of vaccine is scheduled to arrive today (Monday) that the company has imported from the Serum Institute of India.

Beximco asked for the waiver in a letter the National Board of Revenue (NBR), signed by the company's Chief Financial Officer (CFO) Ali Newaz.

Talking to the FE on Sunday, Mr Newaz said the company would be able to vaccinate people at 15 per cent reduced price if the government exempts VAT on it.

"VAT is a consumers' tax that is imposed on the end-users," he said.

He said the price of per dose of COVID Vaccine has yet to be fixed by the Directorate General of Drug Administration (DGDA).

However, according to the current formula of the DGDA, per dose vaccine may cost Tk 1,100, but the company would try to offer an affordable price minimising its profit to 10 per cent, Mr Newaz said.

To vaccinate people, the company needs to rent a large space at the Bashundhara Convention Center and employ at least 800 people, he said.

"The total cost of import and vaccination would be around Tk 300 to 400 million for Covid-19 vaccination," he added.

In the first phase, the company has targeted the corporate sector and its employees as private sector is the life-line of the economy, he said.

Currently, there is no VAT on medicine, but the service charges for administering the vaccine is taxable as per law.

Beximco pharma signed an agreement with the Serum institute to import Oxford- AstraZencca vaccine in December. The country's largest drug exporter is the lone distributor in Bangladesh.

The company will supply and distribute the imported vaccine to the government as

well as directly sell and vaccinate the private sector.

A senior official of the VAT wing said all types of health services are exempted from the payment of VAT, including vaccination.

He said the NBR has yet to scrutinise the process of vaccination by Beximco to assess whether VAT would be applicable.

[email protected]

Share if you like