US President Donald Trump has once again taken a big decision regarding trade and medicines. On the occasion of the anniversary of Liberation Day, he has taken such a step, which can affect the world’s pharmaceutical companies and the global market. Under this decision, heavy tax i.e. tariff can be imposed on some patented medicines. This may make medicines expensive and will increase pressure on companies to invest in America. In effect, Trump has again dropped the tariff bomb on the Happy Birthday of Labor Day and has issued an order to impose 100 percent tariff on some medicines.
Under the new policy, Trump has decided to impose up to 100 percent tariff on some medicines. This decision will be applicable to those companies which do not fix prices with the US government. The government has said that no tax will be levied on companies who sign the Most Favored Nation pricing deal and set up factories to manufacture medicines in America.
Companies given time to negotiate
Companies which are not currently doing deals but are investing in America will be taxed at 20 percent. This tax may increase up to 100 percent in the next four years. Companies have also been given time to negotiate with the government. Big companies will get 120 days and small companies will get 180 days. The government says that this step is necessary for the security of the country, so that dependence on other countries for medicines can be reduced. But PhRMA, an organization of pharmaceutical companies, has opposed it. He says that this will make medicines expensive and investment will be affected.
America has also set different tax rates for some countries. Europe, Japan and some other countries will be taxed at 15 percent, while Britain will be taxed at 10 percent. Apart from this, the government has also changed the tariff rules on steel, aluminum and copper. Overall, the purpose of this decision is to force companies to increase manufacturing in America. But this may affect the price and supply of medicines across the world.
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