Still Taxed to Death: An Analysis of Taxes and Tariffs on Medicines, Vaccines and Medical Devices

Roger Bate et al | 01 Feb 2006
AEI-Brookings Joint Center
This paper examines the role that tariffs, domestic taxes, and regulatory requirements pose on access to essential drugs, vaccines and devices for the diseases that afflict the developing world. While aid has increased in recent years and the price of many drugs has fallen, access to medicines, vaccines and devices has not increased greatly. There are numerous reasons for this, notably the paucity of medical professionals in the poorest countries. The major one discussed in this paper is the barrier imposed by recipient countries themselves. For example the combined domestic tax and import tariff barrier in India until recently was over 60% and in Morocco it currently stands at 38%. Only just over a third of Indians have access to essential drugs and it is likely that a reduction of these financial impediments would increase access. Removal of these barriers would therefore likely save thousands of lives across the developing world. Southern African countries generally have fewer tariff barriers. But if South Africa removed its 14% sales tax, HIV patients could afford more food, and many are currently malnourished. Furthermore, many Southern African countries, such as Namibia, impose regulatory constraints (expensive and time consuming registration of products already approved in US/EU), which reduce access to essential medicines.

Read the paper here: http://www.fightingmalaria.org/pdfs/Still_Taxed_to_Death.pdf

This paper is an updated version of a previous paper, published in April 2005 and available here: http://www.fightingmalaria.org/pdfs/taxed_to_death1.pdf