New Delhi: Patients be warned that chemists are currently not stocking
drugs beyond one week. Anticipating set-backs that they will have to face with
the introduction of Goods and Services Tax (GST) in July, chemists have begun
cutting back on the quantity stocked. From stocking drugs for about 30 to 40
days, they are now stocking up for a week at a time.
Chemists, however, insist that patients will not be affected by the
transition. “Stocking beyond a week will not be possible, but drugs will be
available for patients. We can also dispense branded substitutes of other
companies in case of shortage,” said Hakim Kapasi, member, All India
Association of Chemists and Druggists.
It is likely that the pharmaceutical sector will attract 12
per cent GST from July. There is no confirmation on whether the sector will be
exempt from GST in the draft documents of the taxation regime.
“The burden of new regime will fall on retail chemists. Old
stocks will have to be sold according to the new regime. The burden cannot be
passed on to patient as MRPs are fixed. So, we are stocking for fewer days,
until we are sure of the situation,” said Anil Navandar, Secretary, Maharashtra
State Druggists and Chemists Association.
At present, wholesalers and retailers pay six per cent value
added tax (VAT) and an additional excise duty on medicines. Prices are adjusted
by manufacturers who account for earning of wholesalers and retailers. Some do
not levy excise duty, as they manufacture out of excise-free zones like Baddi
in Himachal Pradesh or Sikkim.
The pharmaceutical industry feels that they can take on the
new tax regime with ease. “The 12 per cent tax will not make a difference for
manufacturers as it will offset all other taxes we pay to the government. It is
also not likely that patients will have to face drug price hikes after GST. But
the government should take a call on hiccups faced by retailers on how to
return to them the difference they will foot, as patients do not pay extra,”
said a senior manager from Lupin Limited.
Source: DNA-2nd May,2017
