Government proposes VAT exemption on medical use oxygen
By Melanie Aanyu,
The government has proposed the exemption of Value Added Tax-VAT on oxygen for medical use.
This is under the Value Added Tax (Amendment) Bill, 2022 that is currently before Parliament’s Finance Committee for scrutiny.
“Clause 4 seeks to amend the Second Schedule to the Principal Act that lists supplies of goods and services that are exempt from VAT.
It substitutes the paragraph related to oxygen cylinders with oxygen cylinder or oxygen for medical use,” reads part of the Bill.
According to Henry Musasizi, the Minister of State for Finance- General Duties, the Value Added Tax Act currently only exempts cylinders but not oxygen, and the proposed exemption is in a bid to make it affordable.
Musasizi also explains that the proposed law also seeks to remove the condition of a hospital at the level of a national referral to only benefit from VAT exemption of the supply of services to conduct a feasibility study, design and construction, the supply of locally produced materials for the construction of premises and other infrastructure, machinery and equipment or furnishings and fitting to a hospital facility developer.