The Government of Saint Lucia has noted the concerns of several citizens about the cost of medicines following the implementation of VAT. The Government fully appreciates the sensitivity of our citizens over the price of medicines.
Mindful of the likely impact of VAT on the prices of medicines, the Government took a major step to cushion the retail price of medicines.
Prior to the implementation of VAT, medicines attracted an Import Duty of 10% followed by 5% Consumption Tax.
The Government of Saint Lucia secured the agreement of CARICOM to suspend the Common External Tariff on pharmaceuticals for a period of four years from May 01, 2012 to April 30, 2016. This means that unlike other imported goods, Import Duty will not be charged on medicines for the next four years. So VAT will not be imposed on top of the import duty that medicines attracted in the past.
This is a period of adjustment for all so retailers may well have previous stock on their shelves at old prices with the old tax rates.
It should always be remembered that since VAT is always the final tax to be added to the value of any good imported or sold locally, this may result in the import value or selling price being slightly higher or lower, depending on the movement of the price of the imported commodity.
The Government wishes to assure the public that it will constantly monitor the situation as it would not wish its citizens to be unduly prejudiced or affected by the price of medicines.