This is an announcement on behalf of the Department of Health and Social Care (DHSC).
HMRC have clarified that VAT is not applicable on products supplied in accordance with serious shortage protocols (SSPs).
From 1 June 2023, the allowance for VAT currently paid alongside product reimbursement will stop being paid when reimbursing for products supplied in accordance with SSPs. This change will be reflected from the June 2023 Drug Tariff.
Until the end of May 2023, for products supplied in accordance with a SSP, a VAT allowance will continue to be paid.
HMRC will be updating their guidance on the correct VAT liability of SSP shortly.