The central revenue department, after the joint discussion with the industry associations along with the trade body, has asked for suggestions from the industry stakeholders to frame an appropriate duty structure for pharmaceutical products. The meeting was convened by the revenue department officials with the industry representatives on the ongoing issue of MRP-based Excise Duty on pharmaceutical products.

As the Union Budget is only a month away from now, the government is unlikely to make any change on the MRP-based Excise Duty.

According to Ranjit Shahani, president of OPPI, after the discussion with the revenue secretary, the department has shown an openness to revise their decision. "We will give our suggestions soon to convince the government about a rationalise approach on the duty structure," he said.

However, the OPPI president said that the government decision to impose an Excise Duty on the MRP allowing an abatement of 35 per cent is a shock to the industry. The industry can never work within an unrealistic duty structure like this where the actual distribution and promotional costs exceed far beyond the government permitted abatement of 35 per cent, he added.

While talking to Pharmabiz in Pune, Rakesh Bhargava, president, (Asia Pacific) Fresenius Kabi India, one of the leading IV fluid manufacturer in the country, said that the currently announced MRP-based Excise Duty with an abatement of 35 per cent is absolutely unrealistic as the government has never attempted to take the suggestions from the industry. "With such a duty structure, the industry is left with only two options of either to stop production of items falling under the Excise Duty or to shift the manufacturing facilities to the places where they are exempted from Excise Duty," he opined.