Everyone must say it …
by The Albaani Site
The Prophet, صلى الله عليه وسلم, said, “Indeed Allaah loves the one who sneezes and dislikes yawning. So if someone sneezes and then praises Allah it is obligatory upon every Muslim who heard him to say, ‘May Allaah be merciful to you …[يَرْحَمُكَ الله] …’”
Shaikh Al-Albaani, may Allaah have mercy upon him said, “And his, صلى الله عليه وسلم, saying, ‘… then it is obligatory upon every Muslim who heard him …’ is a clear proof showing the obligation upon everyone who heard him to say the tashmeet (i.e., may Allaah be merciful to you [يَرْحَمُكَ الله]). And what has become widespread about it only being a fard kifaayah, i.e., that when some people say it the obligation is no longer upon the rest to say it also, is something which is not proven here, in contrast to returning the salaam.”
Tahqeeq Kalimat-Tayyib, 158.