Finance Minister Nirmala Sitharaman on Saturday addressed the outcome of the 44th Goods and Services Tax (GST) Council will meet in New Delhi.the meeting was attended by Minister of State for Finance Anurag Thakur, besides finance ministers of states and Union territories and senior officers from Union government and states on Friday where they discussed rate rationalisation on COVID-19 related goods.
Sitharaman, in her press conference, said that GST Council had approved all recommendations of GoM on rate rationalisation. She added that GST rates have been decided for 4 categories of products- medicines, oxygen, oxygen-generation equipment, testing kits and other machines and other COVID-19 related relief material.
She said that the council has cut tax for medicines on mucormycosis, widely known as black fungus, to nil. These include Tocilizumbab, Amphotericin B medicines. GST rates on the specified items being used in COVID-19 relief and management till 30th September 2021.
She also said that GST on ambulances will be reduced to 12% from 28%. However, Sitharam added that 5% GST on vaccines will stay. The Centre will buy the 75% vaccine as announced and will pay its GST too. But 70% of income from GST will be shared with States.
GST on electric furnaces and temperature checking equipment brought down to 5% and on ambulances to 12%. These rates will be valid till September as against August end recommended by the GoM, Sitharaman said.
At its meeting on May 28, the GST Council had recommended full exemption from IGST on a number of specified COVID-19 related goods such as medical oxygen, oxygen concentrators, and other oxygen storage and transportation equipment, certain diagnostic markers test kits, and COVID-19 vaccines even if imported on payment basis for donating to the government or on the recommendation of state authority to any relief agency.
The exemption is valid up to August 31 this year.
Currently, 5% GST is levied on domestically manufactured vaccines, while it is 12% for COVID drugs and oxygen concentrators.
As regards individual items, the GST Council decided to constitute a Group of Ministers (GoM) “to go into the need for further relief to COVID-19 related individual items immediately”.
The Council also decided to reduce the compliance burden of small taxpayers and medium-sized taxpayers and recommended an amnesty scheme for reducing late fee payable, to provide relief to small taxpayers.