Pharmacy Of Your Choice ‘in jeopardy’ after ministry fails to honour €14,000 tax credit

The finance ministry is refusing to effect a generous tax credit it promised in a 2007 agreement with the Chamber of SMEs (GRTU), to attract pharmacies to dispense free medication through the Pharmacy Of Your Choice (POYC) scheme.

The GRTU says the ministry promised a 200% tax credit on a maximum Lm3,000 spend on software and equipment made by pharmacies to implement the POYC – equivalent to €13,976 being deducted from tax due.

But the Commissioner of Inland Revenue informed the GRTU soon after that it would not effect the credits unless a legal notice is published, and later insisted on renegotiating the cap down to €9,000.

“When the Commissioner of Inland Revenue realised the memorandum allowed for a 200% tax credit of the expenditure made, up to a maximum of €13,976, they decided to oppose the amount and insisted on its renegotiation and needed to arrive to a compromise since the capped amount had to be indicated in the legal notice,” the GRTU said.

All parties later agreed to add a claim for depreciation in addition to a maximum €9,000 to be deducted from tax due. But after the legal notice was published, the GRTU was told the deduction would be from the taxable amount and not from the tax due.

The GRTU said repeated attempts to meet Finance Minister Tonio Fenech have been unsuccessful. “As things stand today, the POYC is in jeopardy… GRTU is under great pressure by its members who were assured they will be directly refunded through the tax credit scheme.”

The chamber, which includes a strong lobby of pharmacy owners, said it would resort to industrial directives and stall the scheme just as it was about to be introduced in Birkirkara.

The GRTU said it was aggrieved that government officials sign agreements, to be later disregarded by ministerial decisions. “This is not good governance, but political dishonesty. It’s a tremendously negative trend in industrial relations.”