India's GST Reforms Lower Drug Prices, But API Tax Gap Raises Pharma Concerns
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India's Goods and Services Tax (GST) reforms are set to reduce medicine prices, benefiting patients and businesses. While the government has lowered GST on several expensive drugs, a higher tax rate on Active Pharmaceutical Ingredients (APIs) is creating working capital pressure for pharmaceutical companies, particularly smaller ones. Experts are concerned about this 'inverted duty structure,' though provisional refunds are expected to mitigate some challenges.
In a nutshell
This article highlights the dual impact of economic reforms, demonstrating how a policy designed to benefit consumers through lower prices can simultaneously create financial hurdles for specific industry sectors. It underscores the ongoing challenge of balancing consumer welfare with business sustainability within a dynamic tax framework.
Source: The Economic Times
