- VAT Exemption on Transformation Funds: The transformation funds paid by the Ministry of Health, Welfare and Sport to health insurers for the years 2023 to 2027 are not subject to VAT, as confirmed by a letter from the Tax and Customs Administration.
- Purpose of Transformation Funds: The funds are intended to facilitate necessary transformations in healthcare to maintain accessibility and affordability, and their VAT treatment may impact the overall size of the available funds for these transformations.
- Taxable Transactions: While the transfer of transformation funds between the Ministry and health insurers is not considered taxable, payments made to participants in the transformation plan could be subject to 21% VAT, as these may be viewed as taxable transactions. The letter does not address the VAT implications of individual transformation plans approved by health insurers.
Source Taxlive
