- Payments by a medicine manufacturer to the UK Department of Health and Social Care (DHSC) did not qualify as price reductions for earlier supplies to wholesalers and pharmacies.
- The Upper Tribunal ruled that a direct link between the repayment and the original supply consideration was required, which was lacking in this case.
- Even when medicines were supplied directly to the DHSC, no price reduction could be applied if the final supply to consumers was zero-rated, to avoid breaching fiscal neutrality and causing tax loss.
- The payments were considered a form of price control or profit regulation, not a refund or reduction of the original supply price.
Source: simmons-simmons.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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