Pakistan

Controversy Around the Government's 15% General Sales Tax on Medicines

March 21, 2002. President Musharraf's government announces a 15% General Sales Tax (GST) on pharmaceuticals. The GST is levied as part of conditions attached to an IMF loan. Pakistani consumer groups and pharmacists are strongly opposed to the GST, and they launch a campaign to have it repealed. There are calls for strikes. On March 29, the government announces that it will repeal the tax for live-saving drugs, but advocates continue to work for the total repeal of the GDT. The best source of information on these developments is the Network for Consumer Protection.

August, 2002. Consumers Rights Commission of Pakistan. TheNetwork's campaign against GST on medicines "results".

August 22, 2002. Consumers Rights Commission of Pakistan. Consumer’s Success in Withdrawal of GST on Medicines.

April 2, 2002. The Consumer Rights Commission of Pakistan. Government Urged to Withdraw GST on All Medicines.

March 29, 2002. Government of Pakistan, Press Information Department. President Orders GST Exemption on Life Saving Drugs.

March 28, 2002. Letter to Pakistani President Musharaf.

March 28, 2002. The Network for Consumer Protection press release. Oxfam Pakistan Supports The Network's Campaign Against GST on Medicines.

March 23, 2002. The Network for Consumer Protection press release. Stop taxing the poor patients: Demand to immediately withdraw the 15% General Sales Tax on Medicines.

March 22, 2002. Consumer Rights Commission of Pakistan. CRCP Vows to Launch Campaign Against GST on Drugs.

(No Date) The Tax Library of Pakistan. 15% sales tax imposed on medicines.

(No Date) Dr. Ikramul Haq. IMF's move of 15% GST on medicines: Alleviating poverty by taxing the poor!

News Stories

September 6, 2002. Dawn staff reporter. GST chaos leads to shortage of medicines.
April 4, 2002. Syed Bukhar Shah for TheNews. Speakers ask govt to withdraw GST on drugs.
April 2, 2002. The Business Recorder. 400 Drugs Excluded from General Sales Tax List.
April 2, 2002. Muddassir Rizvi for the Asia Times. Musharraf backs down on new drug tax.
April 1, 2002. Ashfak Bokhari for Dawn. Taxing the Distressed.
April 1, 2002. Paknews.com. Musharraf ordered action against health officials.

Earlier Trade Dispute with the US

US Trade Representative's Office. Section 301 Table of Cases contains this information of a trade dispute from the mid 1990s involving pharmaceuticals.
On April 30, 1996 USTR self-initiated an investigation under section 302(b)(1) of the Trade act with respect to certain acts, policies and practices of the Government of Pakistan that may result in the denial of patents and exclusive marketing rights to U.S. individuals and firms involved in the development of innovative pharmaceutical and agricultural chemicals products...
After consultations between the United States and Pakistan, Pakistan issued Ordinance No. XXVI of 1997. On February 28, 1997, the United States and Pakistan jointly notified the WTO Dispute Settlement Body (DSB) of the settlement of this matter in light of Pakistan's planned implementation of Ordinance No. XXVI.
June 20, 1997. Office of the US Trade Representative document published in thye Federal Register. Notice of termination and monitoring.
CPT Note on What the Special 301 Watch Lists and Reports Actually Mean. This is an older document originally written in connection with US bilateral pressure against South Africa, but it is still a usefull explanation of the USTR reports.

Other Documents

July 25, 2002. Dawn Newspaper. Move to Deregulate Pharma Sector Deplored.
April 23, 2002. Network for Consumer Protection press release. Deregulating Pharmaceutical sector in pakistan: A great threat to Public health.

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