Health firm urges removal of VAT from Covid test costs

A healthcare firm is urging the government and transport secretary Grant Shapps to withdraw its charging of VAT on the costs of PCR testing for air travel.

Salutaris People, a lead partner in offering Covid tests at Liverpool John Lennon airport, claims the withdrawal of the 20% tax “is the right thing to do” and would pass on savings to airline passengers and consumers.

The private healthcare and medical company also called on all the major laboratories processing PCR tests to demonstrate transparency over their ‘true-costs’ and pass on equivalent cost reductions to Covid testing companies for equal parity.

AKEA Life managing director Ben Paglia, clinical partner to Salutaris People, said: “The government have set the standard of Covid testing for air travel, with PCR tests being mandated as the ‘gold standard’ in the safe resumption of air travel.

“It is only right and proper therefore that the government does not charge VAT on PCR testing. By lowering the costs of PCR tests, this would also make air travel affordable again. It would also make a difference to the price that the consumer pays, reducing PCR test costs.”

While some laboratories have publicly announced they have dropped the price of PCR test kits to £60, Paglia believes this was a “knee-jerk” reaction.

Laboratories were forced into reducing the cost of the home test kit to appease the government and avoid a media backlash over the “obscene” costs being charged, he claimed.

This decision followed the comments made by Shapps who said that the price of PCR Covid testing set by these companies was far too high.

“As a healthcare company, we are transparent in everything we do. It is clear that the laboratories have been making vast profits at the expense of the public and airline passengers and test providers since the pandemic started,” Paglia added.

“If a laboratory can drop the price of a test from £120 to £60 overnight, then that would suggest that there is sufficient margins to offer the same discount to all of their customers.

“We are saddened to see that the saving given to the airlines has not been passed on to the medical customers, who have been working hard on the front line with Randox since the beginning of the pandemic delivering testing services and patient care.

“It leaves us in the difficult position of appearing to the public as though we are increasing prices and profiteering and that simply isn’t the case. It has left us with no alternative but to move to a lab that is transparent on prices and interested in a true partnership, which delivers healthcare and testing services with the customer first and foremost.

“The government needs to hold an enquiry and questions really do need to be asked about precisely how much the tests actually cost and the vast sums of money being made by these companies.

“All businesses must make a profit and that is understood, but it is about being fair and reasonable. I am calling for greater transparency on the true cost of these tests, in order for us all to deliver better value and care for whoever needs these tests in the UK market.

“Airline passengers and the public have every right to be angry when they see such blatant profiteering.

“The private testing companies like Salutaris People have been on this journey from the start of the Covid-19 pandemic providing testing services in a clinical environment with trained healthcare staff.

“Despite offering these home delivery PCR test kits to the airlines at £60 per test, the laboratories have not passed down the same savings to us as medical customers so that we can in turn pass on reductions to our customers.”

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