Department of Pharmaceuticals under Ministry of Chemicals and Fertilizers issued Office Memorandum vide File No. 19(175)/2019/DP/NPPA/Div.II dated June 15, 2021 instructing manufacturers to revise MRP of drugs in line with slashed GST-rates.
The undersigned is directed to refer to the queries from some of the manufacturers/marketing companies regarding implementation of MRP on the drugs due to change in the Tax/GST rates.
In this regard, reference is invited to the O.M. No. 25(5)/2014/Div-V/NPPA dated April 13, 2016 (copy enclosed) issued by NPPA which contains detailed guidelines for compliance of revised prices by manufacturers/marketing companies.
The change in Tax/GST rates has an impact on the fixation of MRP of items attracting Tax/GST. As per DPCO. 2013 MRP of drugs/formulations is inclusive of Taxes/GST. Therefore, any downward change in Tax/GST rates should be reflected In MRP and benefit of Tax/GST reduction should be passed on to consumers.
In view of the above, all the manufacturers and marketing companies are required to revise the MRP of drugs/formulations on which Tax/GST rates have been reduced taking Into effect the revised rates of Tax/GST. Recalling or re-labelling or re-stickering on the label of container or pack of released stocks in the market prior to date of notifications, is not mandatory, if manufacturers are able to ensure price compliance at this retailer level through issuance of a revised price list
The Office Memorandum can be accessed at: http://www.a2ztaxcorp.com/wp-content/uploads/2021/06/office-Memorandum15062021.pdf