Union Budget 2024 wish list: Tax benefits for pharma, IPR, infrastructure status for hotels

India's pharmaceuticals and hospitality sectors expect tax concessions and a lot of support out of the 2024 union budget.

Its important to incentivise research and development, provide tax concessions, and create effective intellectual property rights to develop India's pharmaceuticals industry and hotels should be recognised as infrastrucure and not a luxury, PTI wrote, quoting industry bodies.

Finance Minister Nirmala Sitharaman (PTI)

What does India's pharma industry expect from the 2024 Union Budget?

Anil Matai, Director General of the Organisation of Pharmaceutical Producers of India (OPPI) sought incentives for training pharmaceutical employees, along with effective intelectual property rights for the pharma sector, both domestic and global to introduce innovative therapies in India for addressing unmet needs.

He also recommended creating more centres of excellence (CoEs) for R&D on rare diseases.

Apart from this, "expanding the list of life-saving drugs eligible for GST/import duty exemptions, including all oncology medications, will further improve patient affordability," Matai said, adding that the government should give incentives for investing in bonds of pharma companies.

OPPI represents pharmaceutical companies like AstraZeneca, Novartis and Merck, in India, that are involved in research.

Sudarshan Jain, Secretary General of the Indian Pharmaceutical Alliance (IPA) said that continuous investment in the pharma sector is crucial due to high risk, lengthy development periods, and low success rates in research.

The members of the IPA include Cipla, Dr Reddy's Laboratories, Sun Pharma and Lupin.

What does the hospitality sector expect from the 2024 Union Budget?

The hospitality sector wants the government to give infrastructure status to hotels, rather than classify them a luxury, to make investments on new properties more attractive.

“The sector is burdened with high taxation, expensive and multifarious licences, approvals and compliances,” Hotel Association of India (HAI) President KB Kachru told PTI. “Hotels are capital intensive with a long gestation period. Cost of operating hotels is high and largely fixed.”

Lower utility tariffs, reduced property taxes, easier access to finance and softer loans are crucial for reducing the cost of doing business, ensuring the long-term viability of the sector, Chalet Hotels Ltd Managing Director and CEO Sanjay Sethi told PTI.

Royal Orchid Hotels Chief Finance Officer Amit Jaiswal said that that the hospitality sector has high expectations from the upcoming Budget, as it has been heavily impacted by recent economic fluctuations.

Jaiswal also said the sector anticipates favourable tax reforms, highlighting that "India imposes one of the highest GST rates on tourism compared to countries like Thailand, Vietnam, Sri Lanka, and even European nations".