Change in VAT Rates for Medicines

Pharmeca a.s. 27. 02. 2024

Based on the amendment to Act No. 235/2004 Coll., on Value Added Tax, as of January 1, 2024, there has been a change in VAT rates, particularly impacting the increase in prices and reimbursements for medicinal products. In the infographics, we will illustrate how the individual rates have changed and examine the international comparison to assess the impact on the Czech Republic.

While the standard VAT rate remains at 21 percent, the original reduced rates of 15 percent (for medical devices) and 10 percent (for medicinal products) have been unified into a single 12 percent rate. The newly introduced zero rate applies exclusively to books, although the inclusion of medicinal products could have been possible in line with European legislation.

The infographics provides an overview of the changes in rates as follows:

Change in VAT rates

Change in VAT rates

In international comparison, the Czech Republic finds itself in the less favorable top positions of the ranking of applied VAT rates on reimbursed medicinal products. Many countries still maintain lower, extra reduced, or even zero VAT rates on medicinal products despite the current economic situation.

Sazby DPH/VAT rate

Sazby DPH/VAT rate

Source: Statista. (2023, December 21). VAT rate on prescription-only drugs in Europe by country 2023.

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