Pharmacies delivering free medicines to patients aged 70 and over will be entitled to a €14,000 tax credit to cover their expenses, which may include the purchase of a car, this newspaper has learnt.
The measure could cost the government up to €3 million in tax revenues, as it implements the Labour Party’s electoral pledge to introduce a home delivery service for the elderly.
An agreement over the new service was signed between the government and the Chamber of Pharmacists last year but the details had been kept under wraps until last week, when a legal notice was published with changes to the Income Tax Act.
As he presided over the signing of the agreement in October last year, then health minister Konrad Mizzi had said that “this is another step forward because elderly patients will have the choice of receiving medicine directly at home and the government will not pay extra for this premium service”.
But, if all 219 participating and licensed pharmacies claim the maximum tax rebate, the government would be forfeiting €3.08 million.
The legal notice authorises the tax deduction for pharmacists who offer the delivery service to clients making use of the Pharmacy of Your Choice (POYC) scheme. Rolled out in 2007, the government scheme allows patients to pick up their free medicines at their preferred pharmacy.
This is the delivery of another electoral commitment which will further improve services for our patients
Sources said the rules covering the new home delivery service apply to any pharmacy outlet which incurs capital or labour expenditure, such as the acquisition of equipment, including a vehicle, and the payment of personnel.
The incentive will be given in the form of a tax credit in respect of expenditure incurred with effect from the beginning of this year.
According to Legal Notice 283 of 2016, the tax credit shall be equivalent to 100 per cent of the costs incurred by a pharmacy. The maximum tax credit shall be capped at €14,000 and may be claimed until December 31, 2019.
Under the agreement, pharmacists will also assume administrative responsibilities to manage medicine stock levels to ensure there are no shortages.
In reply to questions by this newspaper, a spokeswoman for Health Minister Chris Fearne said all pharmacies registered in the POYC scheme were eligible for the tax credit and that there were no further payments directly related to the new service.
“All patients who are over 70 and disabled people whose disability limits their mobility can apply for the 70+ Domiciliary Delivery Service,” the spokeswoman said.
“This is the delivery of another electoral commitment which will further improve services for our patients following the effective steps taken by the government to address out-of-stock medicines which were out-of-control in previous legislatures.”
She did not say whether the government will also pay for the fuel , insurance and running costs.