Senate committee approves tax deduction for high-cost drug spending

The Committee on Economic Affairs of the Senate approved this Tuesday (17) a bill that cuts off the Individual Income Tax expenses with high-cost medicines and for continuous use.

The proposal was approved by the committee members by 11 votes in favor and two against. As the vote was final, it will only need to be analyzed in plenary if there is a request with this request. Otherwise, it goes straight to the Chamber of Deputies.

The project authored by Senator Álvaro Dias (Podes-PR) provides for a deduction in the Personal Income Tax for medications for continuous use and outside the hospital environment.

Currently, it is possible to deduct treatment with medical, dental and hospital assistance. In relation to medicines, it is possible only when characterized as a hospital expense.

“The project’s objective is to make life easier, especially for the elderly, especially those who use continuous-use drugs. These are serious diseases, such as cancer, Alzheimer’s, Parkinson’s, among others, that require the use of continuous-use drugs. And are expensive medicines”, says the senator.

The senator’s original proposal called for the creation of a drug subsidy program. However, during its process, it was found that the creation of a program for the government to implement could incur an initiative defect. Therefore, an alternative proposal was made, which amends the legislation on income tax to include the new possibilities of deduction.

The text also stipulated that drugs for the treatment of cancer, AIDS, Alzheimer’s, diabetes, Parkinson’s disease, clinical depression, bipolar disorder, fibromyalgia, alpha or beta interferon and chronic cardiac treatment could be deducted from the Income Tax.

The proposal approved by the committee members, however, was not so specific and removed the list of diseases. More generally, it determines that, “in the case of expenses with medicines, [a dedução] is limited to high-cost, continuous-use drugs, as defined by regulation”.

“The extension of the deduction from the calculation base of the Personal Income Tax to the amounts spent by the taxpayer with the purchase of medicines outside the hospital environment is fair and healthy. The restriction that still exists is discriminatory in relation to chronic patients who use of continuous medication and discourages home treatment”, says the report on the bill, by Senator Rogério Carvalho (PT-SE).

The rapporteur also included in the text that the taxpayer must prove the purchase of the drug by means of an invoice in his name and that the purchase has been made upon presentation of a medical prescription.