Kenya

AIDS activists battle tax increase on medicines

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NAIROBI, 5 April 2011 (PLUSNEWS) - Kenyan AIDS activists are furious about a plan by the government to implement a 2 percent tax increase on medicines, which they say will hurt poor people living with HIV.

In November 2010, Kenya's Minister for Medical Services issued a gazette notice imposing the new tax on drugs to help fund the Pharmacy and Poisons Board, the government body mandated to regulate drugs in the country. The Kenya Revenue Authority already collects a 2.75 percent tax on medicines.

"When you increase taxes on essential drugs, it will push up their costs because manufacturers and importers will pass that extra burden to consumers," said James Kamau, coordinator of the Kenya Treatment Access Movement. "The government cannot even put everybody on HIV treatment because they can't afford it, yet they are putting more tax on the same drugs they are unable to buy."

While the government provides free antiretroviral drugs to an estimated 400,000 people living with HIV, patients are expected to pay for medication to treat opportunistic infections.

The activists have gone to court to block the government from effecting the new tax on the grounds that the minister lacks the authority to levy taxes. The High Court has stopped the government from putting the new tax into effect until the case is determined.

The Pharmacy and Poisons Board has offered to reduce the tax from 2 percent to 0.75 percent, a proposal the lobbyists have rejected.

"We need money to fund certain operations within the Ministry of Health and other sectors of health, so we hope that those opposed to new taxes will understand the need for them," said Kazungu Kambi, Assistant Minister of Medical Services. "We are constantly looking for ways to get money to supplement what we get from the Ministry of Finance and what we get from donors. We have proposals for raising more money which are being discussed at various levels."

In 2009, the government came up with a Health Financing Strategy that proposed, among other things, the removal of user fees at government facilities. However, inadequate funding means the strategy has yet to be implemented.

While activists agree that the health sector needs to be better funded, they say raising the cost of medicines is not the way to do it. "There are many luxury commodities that can be taxed to get more money to fund the health sector without making life unnecessarily difficult for Kenyans who are already overburdened by the spending they have to incur to seek medical services," said Kamau.

"Instead of increased taxes on medicines which Kenyans so much need, the government should increase budgetary allocations to the health sector to cushion Kenyans from high costs of healthcare," he added.

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