What is the Effect of GST on Pharma Industry?

GST (Goods and Services Tax) has rolled out last month and is making waves in the Indian industry. It is an advancement of multi-level taxation system which is providing additional benefits to PCD pharma companies as compared to other industries. This indirect tax system takes account of the consumption done through sale, production and consumption of goods and services at national level which mainly involves industries, companies and services sectors. The idea behind it is to abolish the tax levied of state as well as central government. It involves three components of GST: 

• State GST

• Central GST

• Integrated GST

There is elimination and combination of thirteen indirect taxes including:

1. Value Added Tax (VAT)

2. Service Tax

3. Purchase Tax

4. Tax applicable on lotteries

5. Octroi Duty

6. Food tax

7. Luxury tax

8. Commercial tax

9. Entertainment tax

10. Central Sales tax

11. Entry tax

12. Central Excise Duty

13. Advertisement tax

Positive Impact of GST on PCD Pharma Companies

The costing and taxation system has become simple which has created a common market for everyone with equal opportunities. Due to discontinuation of Central Sales tax and Interstate transactions between two dealers, the traditional cost and distribution model has been replaced by supply chain efficiencies.

• The life-saving important drugs and injections fall under the slab of 5%.

• Pharma manufacturing generic/ dietary supplement companies/ branded formulations will see profits due to reduced taxation and low manufacturing cost.

• The maximum GST on bulk drugs is 18% and around 5% & 12% at maximum.

• The best PCD franchise company in India will find the freedom to discover strategic supply chain as well as distribution channels.

• Another benefit is the reduction in the overall cost of technology. Previously, the technical machinery which was imported in the country by pharma companies was very costly and the duty which was levied was not allowed as a tax credit. However, with GST, the duty charged on the import of such equipment would be allowed as a credit.

Negative Impacts of GST

• Many Ayurvedic products are in the slab of 12% to 28% as they are falling in the cosmetic range.

• The indirect tax paid by pharma companies is increased by 60% (ignoring the tax credit), which will lead to higher working capital needs.

• The MRPs of many essential drugs will increase by 4%.

•  Other pharma products and medical technology products are ranged between 5% to 12% with a total tax of 11.5% to 18%.

In short term, GST is a pain initially due to its implementation but will eventually become neutral. But in a long term, it will play a positive role for the best PCD franchise company in India.

Gain Higher Profits by Choosing the Best PCD Pharma Company

The Pharmaceuticals industry is the third largest industry in India. With advancements, many multinational companies from different countries have started setting up their subsidiaries. The Government of India has also been generous to the industry as the GST effect which has recently changed the scenario of taxation system of the country has the least effect on this industry. If you are planning to choose a PCD pharma company to invest in then it is indeed a great decision. There are many good PCD Pharma companies in Chandigarh which can provide you more benefits than your imagination. The professional companies give you more facilities as well as support than the other ones.

There are plenty of things which you should consider before investing in PCD pharma companies in Chandigarh. With one wrong step, you can lose not only your money but your time and efforts too. Here, we will discuss some of the ways to choose the best PCD Pharma company:

·      Company History and its authorization

After you have prepared a list of some companies to invest in, look for their history and background.

·      Total Investments

You should prepare a proper budget and then contact the PCD pharma companies according to your needs and demands. It is very important to take your business to the high levels.

·         Certifications and Approval

     A good PCD pharma company will show all the certifications and approvals to the PCD pharma  distributers. There are many certificates that make a PCD pharma company reliable and some of  them are:

Ø  ISO (International Standards Organization)

Ø  WHO (World Health Organization)

Ø  GMP (Good Manufacturing Practices)

Ø  DCGI (Drug Controller General  of India)

Ø  FSSAI (Food Safety   and Standard Authority of India)

·       Other Facilities

A professional Pharma accompany provides support to the PCD pharma distributers. It would be a dull step if you choose to invest in a company which does not offer exciting facilities and services.

Although selection of right PCD Pharma Company is critical for the success of your company, your own efforts in making your company successful matters a lot. It is up to you to build your reputation and increase your customer base. If you make your choices wisely and are dedicated to make your company successful then nothing can come between you and success.