non performing assets

Topics: Pharmacology, Pharmaceutical drug, Value added tax Pages: 27 (5213 words) Published: February 1, 2014
ORGANISATION OF PHARMACEUTICAL PRODUCERS OF INDIA
Peninsula Corporate Park, Peninsula Chambers, Ground Floor, Ganpatrao Kadam Marg, Lower Parel, Mumbai 400 013. Telephone: 91 + 22 + 2491 8123, 2491 2486, 6662 7007 Fax: 91 + 22 + 2491 5168 Email: indiaoppi@vsnl.com OPPI PRE-BUDGET MEMORANDUM - 2013-2014

INDIRECT TAXES
A. CUSTOMS DUTY
Sr.
No.
1.

Issue

Justification

Customs duty exemption/ reduction to Life Saving It is imperative that critical life saving drugs be made available to the drugs, diagnostic equipments and consumables thereof patients at reduced prices, which will help in bringing down the cost and medical devices.

of treatment for these ailments. Further, reduction in import duty on medical devices would overall reduce the cost of treatment of patients and help in making available the best medical facility in India at relatively cheaper rates.

Diagnosis is an important aspect of the healthcare, which helps in detection, prevention and cure of disease. Being a vital segment of healthcare industry, Government should make the diagnostic
material tax free or rationalise the tax so as to encourage people for active participation in diagnosing the disease, which will help to prevent the disease or avoid its further aggravation.
Proposed Amendment
All life saving drugs (including medical devices) should be
exempted from customs duty on import into India. Diagnostic
equipments and consumables thereof specifically required for detecting life threatening diseases should be exempted from the levy of customs / central excise duty.
Similarly other diagnostic equipments and consumables should attract lowest slab of customs/central excise duty to make
diagnosis cheap and affordable to one and all in India.

2
Organisation of Pharmaceutical Producers of India

Sr.
No.

Issue

Justification

2.

Presently the Basic Customs Duty (BCD) on formulations is The suggestion is in line with the Chelliah Committee’s long10% (other than specified drugs, life saving drugs, vaccines term fiscal policy recommendation. and bulk drugs for which the BCD rate is 5%).

Proposed Amendment
Issue:
Reduction in BCD to 5% for Formulations.
Rationalisation of Customs Duty for Formulations

3.

High customs and central excise duty on Neutraceuticals and
Health Supplements
Particulars

Import
BCD
Additional
Customs Duty
('ACD')
Special
Additional
Customs Duty
('SACD')
Manufacture
Central excise
duty

Drugs and
Pharmaceuticals

Neutraceuticals
and Health
Supplements

10%
6%

30%
12%

Exempt (subject to
conditions)

4% (subject to
specific
exemptions, if
any)

6%

12%

There is no specific identified entry in the Customs and Central Excise Tariff for products generally referred as “Health
Supplements” and “Neutraceuticals”. This category covers general health supplements, foods for special nutritional uses, foods for medical purposes and infant products.
These products play an important role in the overall healthcare and well being of the population and in the said context, must have equal parity with the drugs/ medicines. Majority of Indian population is affected by a variety of diseases like diabetes, cardiac, cancer etc., and nutrition plays a significant role in early recovery and disease management etc., in addition to

treatment and use of drugs.
The healthcare industry and medical professionals have also
started recognizing the role of nutrition in therapy and disease management. It is increasingly observed that the effect of
drugs and other treatment are significantly better, when
managed with right nutrition.
Similarly, in case of infants, nutrition plays an important role in growth as well as disease management. With high rate of
infant mortality in India, it is pertinent to address these
nutritional issues and reduce healthcare costs.

3
Organisation of Pharmaceutical Producers of India

Sr.
No.

Issue

Justification
However high BCD on...
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