The upcoming budget 2020 in stores some good news for local pharma companies indulging in research and development. The government is mulling to restore tax benefits on research and development expenditure incurred by local pharma companies in a move to boost research in drug manufacturing sector.

Tax break to local pharma companies for R&D expenditure was one of the key recommendations made by Department of Pharmaceuticals (DoP) as a part of its budget proposal to the finance ministry.

The tax break would mean restoration of weighted deduction on expenditure incurred on R&D to 200%. Currently, the sector enjoys 150% weighted deduction on R&D but it is scheduled to come down to 100% from 2020 unless government decides to do the otherwise.