Drug maker Abbott to reimburse stockists for GST losses

Current rate of tax and duties on pharmaceuticals works out to around 9%

Drug maker Abbott will reimburse its trade partners for losses that could arise due to changes in the tax rate with the implementation of the goods and services tax from July 1.

The move follows reports that stockists and distributors are keeping inventories to a minimum and there are fears this could result in a shortage of medicines in the market.

In a note to its trade partners on Wednesday, Abbott said in case the new tax structure and the input-claim process results in any loss to partner-stockists on the closing inventory on June 30 or the day preceding GST implementation, it