GST Council: Covid-19 Vaccines To Carry 5% Tax Rate, Says Finance Minister
Union Finance Minister Nirmala Sitharaman said the GST on electric furnaces and temperature checking equipment brought down to 5% and on ambulances to 12%
Mumbai: Union Finance Minister Nirmala Sitharaman on Saturday waived tax on COVID-19 essential items including PPE kit, masks, medicines and equipment.
This crucial decision was taken at the 44th Goods and Services Tax (GST) Council meet on Saturday. The move from the Centre came after several states earlier urged the Union government to consider tax relief on COVID-19 essential items.
Amid significant tax cuts, the GST Council has reduced the tax rate on medical grade oxygen, oxygen concentrators, ventilators, BIPAP machines and high flow nasal cannula (HFNC) devices from 12% to 5%, announced Finance Minister Sitharaman.
The council said that the tax on the COVID19 test kit has been reduced from 12 per cent to 5 per cent.
The Finance Minister said that pulse oximeter, hand sanitisers, temperature testing equipment and ambulances will also attract at least 5 per cent tax.
The Council has also approved the reduction of the rate for Remdesivir from 12% to 5%; however, no tax will be levied on black fungus or mucormycosis drugs tocilizumab and amphotericin.
The new tax brackets were announced soon after the Finance Minister chaired the 44th meeting of the GST Council with an aim to provide tax relief on personal items related to COVID-19 based on the report of the Group of Ministers.
Anurag Thakur, Minister of State for Finance participated in the 44th Council meeting. Finance ministers of states and union territories and senior officials of the central government and states were also present in the meeting.
Ahead of the meeting, finance ministers of some states in the GoM had advocated rate cuts on COVID-19 exigencies.
In the last meeting of the GST Council, held on May 28, there was no change in taxes on COVID-19 vaccines and medical supplies as to whether the benefit of the tax cut would be passed on due to the growing rift between the BJP and the opposition-ruled states.
As of now, 5% GST is levied on domestically manufactured vaccines, while 12% is charged on Covid-19 drugs and oxygen concentrators.
The Council discussed the report of the Group of Ministers, headed by Meghalaya Deputy Chief Minister Conrad Sangma, on GST concessions on COVID-19 relief items like medical grade oxygen, pulse oximeters, hand sanitisers and ventilators, among others.
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