Industry & Economy
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Pharmaceuticals
Drug makers ask for postponement of VAT by three months
Our Bureau
Mumbai
,
Feb. 14
THE Indian Drug Manufacturers Association (IDMA) has called for the postponement of value-added tax (VAT) implementation by three months.
"March being the financial year closing for most of our publicly-held member companies, we would request you to postpone the implementation by three months and make it effective from July," IDMA said in a letter to Dr Asim Dasgupta, Chairman of the Empowered Committee, and other State-level ministers.
An IDMA official said that the extension was sought as companies have already got their stocks in place with the existing tax rates.
Since the VAT white-paper announcement was made recently, stockists are wary about the transition into the VAT regime.
Among other things, they are concerned about the time involved in getting compensation for stocking products that have tax rates of the pre-VAT regime.
With the implementation of VAT, there should be a single-point tax based on maximum retail price only at the manufacturer's level for all medicines.
This will ensure full realisation of VAT, early receipts by States, and minimise VAT collection/assessment costs and avoid unnecessary work and harassment of intermediary traders, the letter said.
Further, it added, no other tax and levies should be charged by any State.
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