The Uttar Pradesh Chemists and Druggists Federation on Thursday said it would call a state-wide bandh if the government failed to roll back special additional tax (SAT) on medicines.
The state government has imposed SAT ranging from half to one per cent from June 1 on several commodities, which are already taxable under the value added tax (VAT) at 4 per cent.
The federation of about 1,25,000 medicine traders have given the state government 15 days' time to act on their demand.
“If the government fails to act, the medicine traders would be forced to close their business and pour out on the streets,” federation general secretary Suresh Gupta told the media.
He claimed SAT would encourage illegal drugs’ trade in UP, which accounts for one-fifth of annual national trade estimated at Rs 65,000 crore. This does not include roughly Rs 17,000 crore annual export market.
“The half per cent price differential would encourage unscrupulous traders smuggle medicines from other states into UP. Besides, these medicines could also be spurious since there would be little paperwork involved,” he warned.
“About 85 per cent of our members buy directly from drug companies. The remaining 15 are sub-stockists, who buy from other states. This segment is likely to take advantage of the price differential of half per cent,” Gupta added.
