Drugs prices not to be hiked: FM

NEW DELHI, MARCH 22 (AGENCIES)The Government today denied in the Rajya Sabha that imposition of excise duty on medicines on Maximum Retail Price (MRP) would increase its prices.

''With effect from January 8,2005, the Government has prescribed levy of central excise duty on allopathic drugs on the basis of retail price, required to be declared under the Drugs (Price Control) Order, 1995,'' Finance Minister P Chidambaram told the House during Question Hour.

He, however, said there had been no increase in the rate of excise duty on drugs and it continued to remain at 16 per cent ad-valorem.

His assertion came after Najma Heptullah (BJP) asked if it was a fact that duty had been hiked to 35 per cent to make it further difficult for the daily users to buy medicines.

Chidambaram said the Government had prescribed levy of central excise duty on the basis of retail price to ensure certainty in assessment and avoid valuation disputes for all allopathic medicines. Ayurvedic, Homoeopathic, Siddha, Unani and Biochemic drugs were outside the purview of retail price based levy, he said.