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 The Bangalore District Chemists and Druggists Association (BDCDA) has now made a fervent appeal to the All India Organisation of Chemists & Druggists (AIOCD) and government authorities to resolve the issues faced by the retailers arising from the new GST reform which has come into force on September 22.
In a communication to J S Shinde, president, AIOCD, BDCDA president B Thirunavukkarasu said pharmacy outlets are the badly hit. They are complying to the norms that every strip, vial, and pack is re-priced to the new tax rate. They are directly accountable and any oversight will lead to consumer complaints and penalties. There is no safety net for the retailers. Manufacturers avoid re-labelling with a simple price-list update; wholesalers receive extra credit days and compensatory discounts. Only the retailer absorbs every rupee lost between old purchase cost and the reduced MRP.
Retail chemists are not mere shopkeepers or vendors, but are the final link in India’s healthcare delivery chain. Positioned at the patient’s doorstep, they ensure timely access to critical medicines. Their role is indispensable, yet they bear a disproportionate share of operational and regulatory pressures, said Thirunavukkarasu.
In the current trade dynamics, pharma manufacturers are insulated. Re-labelling and new MRPs are optional. No newspaper publicity or revised product lists are mandated. Even the wholesalers are shielded. Here pharma companies compensate wholesalers with additional discounts and extended credit periods—often up to a month. The retailers bear the entire risk. About 40% of retailers remain unorganised, lacking digital systems to manage sudden price revisions. They must sell old stock at newly reduced MRPs while having purchased it at higher GST rates, absorbing the full margin squeeze, he said.
In the recent meeting, AIOCD with CBIC (Central Board of Indirect Taxes and Customs) and NPPA have made it clear that the trade issues are to be resolved directly between the pharmaceutical industry and the trade associations to arrive at a mutual understanding, ensuring the uninterrupted availability of medicines and safeguarding the interests of retail chemists and the public.
Now our appeal to AIOCD is the acceptance of GST stock-clearance returns for non-movable medicines as these kept on at retailer’s rack carry no guarantee of when or if they will sell. Some packs may remain until expiry despite every effort to move them. To prevent financial loss and avoid expired stock in the supply chain, all non-moving medicines purchased before September 22, 2025 should be accepted back from retailers as GST stock-clearance returns, he said.
There is a need for Retailer Support Scheme. With nearly 82% of medicines previously taxed at 12 %, retailers now face an unavoidable financial setback under the revised GST regime. To cushion this impact and ensure uninterrupted access to life-saving medicines, the request is for a uniform 3% trade discount on all purchases across the supply chain for the duration of the GST 2.0 transition period. This allows retailers to offset inventory losses and maintain a steady flow of essential medicines to patients.
Further there is a need for Settlement of Expiry, Damaged, and Non-Moving Medicines. In addition, we seek a clear directive on how retailers under the 1% Composition Scheme who have no input-tax credit should implement MRP reductions required by GST 2.0. Therefore, AIOCD should ensure that no retailer or wholesaler is penalised for procedural lapses or unavoidable delays during the GST 2.0 transition period, up to December 31, 2025, said Thirunavukkarasu.
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