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Budget 2023: VAT exemption extended to services supervised by pharmacists


Budget 2023: VAT exemption extended to services supervised by pharmacists

Chancellor Jeremy Hunt’s budget announcement yesterday included two VAT changes that will affect community pharmacy services.

Firstly, from May 1 the Government’s healthcare VAT exemption will be extended to medical services delivered by non-registered pharmacy staff under the direct supervision of pharmacists.

The PSNC said this would help as businesses “try to make better use of the skill mix within pharmacies” and allow contractors to review the VAT status of any locally commissioned services delivered by non-registered pharmacy staff.

“In time, it could also be used to amend nationally commissioned services such as the Hypertension Case-Finding Service to allow support staff to provide parts of the service,” the negotiator added.

The second VAT change will come in autumn via an extension of the zero rate on prescriptions for medicines supplied through Patient group Directions.

PSNC chief executive Janet Morrison, who earlier this week told ministers that pharmacies will not tolerate the introduction of any new services without a funding uplift, commented: “PSNC has been fighting for changes to these VAT rules for many years so it’s great to see this work finally come to fruition.

“While small in impact in the context of the current challenges, this is a very welcome development.

“But the bigger picture of the Budget brings no such relief. It’s become depressingly predictable that community pharmacy will be overlooked in the Chancellor’s Budget statements, but never has this been a bigger missed opportunity than today.

“It’s particularly insulting that some organisations are being given help with energy bills, but not our network of pharmacies.”

The PSNC said the Government’s “imminent” Primary Care Recovery Plan represents the best hope of securing “extra money” for pharmacies as the sector “teeters on the edge of collapse”.

National Pharmacy Association chief Mark Lyonette said: “These measures don’t touch the sides as far as the massive hole in pharmacy funding is concerned, but we should acknowledge that the government has listened to the sector on these specific VAT matters.

“Although this is a positive signal, it is pennies rather than pounds and another opportunity to fundamentally address the funding crisis in community pharmacy has been missed in this latest Budget.”

The Company Chemist’ Association echoed these comments, with chief executive Malcolm Harrison saying: “These measures will boost capacity in pharmacies, and crucially pave the way for the future commissioning of clinical services in community pharmacy.

“We hope that this is the launchpad for further announcements in the upcoming Primary Care Recovery Plan, including a fully-funded Pharmacy First service in England – a no-brainer for patients, primary care and the NHS.”

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