- All > Medicine Access and Rational Use > Pricing
- All > Public Health, Innovation, Intellectual Property and Trade > Intellectual Property (IP) and Trade
- Keywords > customs
- Keywords > health expenditures - out of pocket
- Keywords > innovation and intellectual property
- Keywords > medicine costs - manufacturer's base price and hidden costs
- Keywords > medicine prices - VAT exemptions
- Keywords > non-tariff barriers
- Keywords > prices / pricing policy
- Keywords > procurement costs - hidden costs (transportation, storage, import tariffs and taxes, wholesale and retail markups, staff salaries, stock losses and procurement practices)
- Keywords > tariffs, prices and access to medicines
- Keywords > taxes on medicines
(2005; 62 pages)
The objective of this study was to examine tariffs levied on medicines. This paper provides data on the tariff rates levied and revenue generated by over 150 countries around the world on different categories of pharmaceutical products. These categories include active pharmaceutical ingredients, finished products and vaccines for human medicines. Data for selected sub-categories of pharmaceutical products is also provided.
The analysis has shown that many countries (41% for active pharmaceutical ingredients and 39% for finished products) for which data are available do not levy duties on pharmaceutical products. Fifty-nine percent of countries for which data are available levy tariffs on pharmaceutical active ingredients. Sixty-one percent of countries levy tariffs on finished pharmaceutical products. A total of 35% of countries still levy import duties on vaccine imports. Ninety percent of countries apply less than 10% tariff rates on medicines. Pharmaceutical tariffs generate less than 0.1% of Gross Domestic Product (GDP) in 92% of countries for which data is available. Furthermore, pharmaceutical tariffs generally do not appear to be structured to protect local pharmaceutical industries.
Factors other than tariffs such as manufacturer’s prices, sales taxes including value-added tax (VAT), mark-ups and other charges are likely to impact the price of medicines more than tariffs do. Nonetheless tariffs are a regressive form of taxation which target the sick. We conclude that pharmaceutical tariffs could be eliminated without adverse revenue or industrial policy impacts.