cover story
are host of presumptions regarding
the process and its ultimate benefits
for the business.
It is expected that with the existing
tax rate of 12% for pharmaceuticals,
the net effective tax rate is slated
to increase by 2.3% as compared
to the earlier indirect taxes
regime. Keeping that in view, the
industry associations also made
representations to the government
to keep the GST rate for medicines
at 5% tax slab. The argument put
forward is that it will help avoid
any inflationary pressure in this
essential segment and in many
cases will help reduce the medicines
prices and act as a booster to the
government’s priority of access and
affordability.
The leading association, FICCI
expressed support to GST. The
Lifesciences Group at FICCI also
conducted a workshop for its
industry members in collaboration
with external tax consultants to
help them get clarity on billing,
invoicing and tax rebates related
matter. “These initiatives helped
our members to get clarity on all
aspects of pricing and taxation
under GST so that they can align
themselves to the new structure
and ensure availability of quality
medicines,” mentioned its
statement.
THE GST RATE STRUCTURE FOR BIO-PHARMA PRODUCTS
18
No Drug GST rate
1 Pharma products 12%
2 Specified life-saving drugs 5%
3 GST on majority of Industrial inputs &
Chemicals (API) 18%
BioVoiceNews | July 2017