House panel approves tax-free local gov’t vaccine procurement

The House committee on ways and means approved on Monday the tax provision of a bill exempting local governments from import duties and taxes for the procurement of COVID-19 vaccines.

During its hearing, the panel approved Section 6 of House Bill No. 8648 filed by Speaker Lord Allan Velasco, which states that “[t]he procurement, importation, storage, transport, distribution and administration of COVID-19 vaccines by the local governments shall be exempt from customs duties, value-added tax, excise tax, and other fees, provided, that the vaccines acquired shall only be used for their residents and constituents, and not for commercial distribution.”

In a statement following the committee’s approval of the bill, its chair, Albay Rep. Joey Salceda, said “the measure aims to complement the government’s strategy of procuring COVID-19 vaccines as quickly as possible.”

“Although I would have preferred that we benefit from purchasing in bulk, [local governments] tend to process procurement faster. Every day counts in the fight against COVID-19,” Salceda said.

“The tariff rates for vaccines is actually just 1 percent. It’s not really about the savings, although the exemption will allow them to buy slightly more vaccines. It’s the amount of processing that the local governments will save from this bill that I think is what matters more,” he added.

Salceda, however, said the national government had to set clear guidelines as to how local governments could procure, store and administer vaccines in the most efficient manner possible.

On Sunday, Senate Majority Leader Juan Miguel Zubiri agreed to amend a measure that would have allowed a direct purchase of COVID-19 vaccines by the local governments, which healthcare groups said might sideline equitable distribution of the pandemic cure.

In a Viber message, Zubiri confirmed agreeing to suggestions of health experts to take the phrase “direct purchase” out of Senate Bill No. 2042.

Union of Local Authorities of the Philippines president and Quirino Gov. Dakila Carlo Cua, meanwhile, said he had “endorsed the same amendment to the House, also.”

Zubiri filed SB 2042 on Feb. 8, as requested by about 70 local governments that wanted to make a higher advance payment to manufacturers or be exempted from regulations that required purchases from the lowest bidder.

Dr. Antonio Dans of the Health Professionals Alliance Against COVID-19 (HPAAC), said in a phone interview that the amendment would resolve key issues that the alliance earlier raised to the lawmakers.

One of HPAAC’s concerns was an “inequitable” vaccine supply allocation between richer local governments and poorer provinces and cities.

Dans said giving local governments a free hand would bypass agencies, particularly the Health Technology Assessment Council, which screens the vaccines for safe use.