Treasury waives VAT and duties on essential medical supplies

NHS suppliers will no longer pay customs duty and import VAT on specific medical goods coming from outside the European single market, the Government has confirmed.

The move comes alongside a drive to remove red tape and boost production of life-saving medical equipment in anticipation of surging demand on the health service.

According to the Treasury, the Chancellor Rishi Sunak will “waive” taxes on medical equipment, such as ventilators, coronavirus testing kits, face masks and personal protection equipment (PPE), which could save suppliers up to 12 per cent on the price of goods.

However, suppliers will need to pay import duties and VAT if they “loan, hire out or transfer goods to organisations or individuals not affected by coronavirus (COVID-19) outbreak”.

The full list of commodities can be found here.

“Waiving import taxes on vital medical equipment such as ventilators will speed up and increase the supply of critical items going to our frontline health workers,” said Mr Sunak, adding that the changes will also make the UK “more attractive to companies who want to produce or donate supplies to fight coronavirus.”

Note: to import medical supplies to the NHS duty-free, importers require a duty deferment account with HM Revenue & Customs (HMRC) backed by a guarantee. Importers of duty-free goods also need to increase the level of their guarantee to cover any additional duty due.

Do you supply goods to the NHS? For advice on how these changes might affect your business, please get in touch with our expert team.

Posted in Business, Covid-19 - VAT & MTD, COVID-19 Business Support Hub, Value Added Tax.