The Bangalore District Chemists and Druggists Association (BDCDA) has requested the Karnataka Government to clarify the definition of drugs in the ordinance on implementation of VAT in the state and to include various medicinal and pharmaceutical preparations under VAT.

The BDCDA also wants to ensure deletion of Para 2 of the Ordinance (No. 1 of 2005 amending Section 4 of the Karnataka Value Added Tax Act 2003 (Karnataka Act 32 of 2004)), that states ‘a registered pharmacy dealer may pay tax on the sale of medicinal and pharmaceutical preparations on the Maximum Retail Price (MRP) indicated on the label of the container or pack as fixed for such goods under the Drugs Price Control (DPCO) 1995’.

In a memorandum to the State Commercial Tax Commissioner Ashok Kumar C Manoli, V Hari Krishnan, president, BDCDA noted the definition of drugs under DPCO is ‘Medicinal and Pharmaceutical preparations sold both by distributors and retailers includes ayurvedic drugs, spirituous medicines, medical drugs under Drugs and Cosmetics Act 1940 and Rules 1945.’

It also covers hypodermic syringes, needles, medicated ointments, liquid paraffin of IP grade, surgical items, dental products, bandages, veterinary drugs, diagnostic kits, medical devices, IV fluid sets and other surgical items. In addition, it also includes several ethically promoted nutraceutical and protein supplements. Further, the medicinal and pharmaceutical preparations also include ethically promoted medicated soaps, creams, lotions, and ointments specially used for specific skin diseases.

In an effort to enable the pharmacy trade to get the benefit of the Ordinance No. 1 of 2005 with reference to Amendment of Section 4, BDCDA demanded removal of Para 2 of the Ordinance and replace it with the wordings of the revised Ordinance, which is in line with the goods specified in the Third Schedule Serial 60. Only then it would provide the much-needed relief to trade, opined BDMA.