Dr Reddy's Russia Arm Slapped Rs 2.45 Cr VAT Penalty

Written By :  Parthika Patel
Published On 2026-01-29 18:03 GMT   |   Update On 2026-01-29 18:03 GMT
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New Delhi: Drug major Dr. Reddy's Laboratories Limited's step-down wholly owned subsidiary, Dr. Reddy's Laboratories LLC, Russia, has received a tax audit decision from the Interdistrict Inspectorate of the Federal Tax Service of Russia, resulting in a Value Added Tax (VAT) levy and a monetary penalty of Ruble 20.09 million (approximately Rs 24.50 million).

In a regulatory disclosure, the company stated that the tax audit decision was received on January 23, 2026, in compliance with Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

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According to the disclosure, the Russian tax authority has reclassified certain marketing services as taxable services, which led to the levy of VAT on the subsidiary. Following this reclassification, the authority quantified a penalty of Ruble 20.09 million, equivalent to ₹24.50 million.

Dr Reddy’s clarified that, based on its internal evaluation, the tax audit order is not expected to have any material impact on the company’s financials, operations, or other business activities, despite the penalty imposed.

The pharmaceutical company further stated that it will evaluate the matter and file the necessary reply or response with the concerned authority in connection with the tax audit decision.

Also Read: Dr Reddy's Denosumab Biosimilar AVT03 Faces USFDA Setback After Plant Inspection

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