The all-powerful Goods and Service Tax Council, at its June 12 meeting, reduced GST rates on a number of crucial elements in the fight against the COVID-19 pandemic. These include essential medicines, oxygen, oxygen generating equipment, and related devices, and diagnostic and testing machine kits.
These GST cuts were recommended by the Group of Ministers (GoM), which formed after the last GST Council meeting on May 28 to deliberate on possible reductions in COVID-related items. In a media briefing after the GST Council meeting, Finance Minister Nirmala Sitharaman said that the recommendations of the government of China have been accepted.
“The GoM's recommendations were accepted. They had suggested that these cuts were applicable until August 31st. After discussions, it was decided that these rates will be applicable until September 30, 2021, "Sitharaman said.
Items on which rates have been cut include remdesivir, tocilizumab, medical oxygen, oxygen generator, ventilators, masks, COVID-19 test kits, electric cremation ovens, ambulances, temperature control devices, and others. “While reductions on drugs and equipment are good welfare measures, the shortening of the exemption period would make it difficult for businesses to plan new investments and expand their supply chains to ensure they reach all corners of the country. manufacturing and trade hope that the period will be extended beyond September 30, "said MS Mani, senior director of Deloitte India.
The GoM includes Meghalaya Prime Minister Conrad Sangma, Gujarat Deputy Prime Minister Nitin Patel, Maharashtra Deputy Prime Minister Ajit Pawar, Goa Transport Minister Mauvin Godinho, Kerala Finance Minister KN Balagopal, Finance of Odisha Niranjan Pujari, Finance Minister of Telangana Harish Rao and Uttar Finance Minister of Pradesh, Suresh Khanna.
At its meeting on May 28, the Council did not decide on either rate cuts or zero rates. However, it has decided to exempt COVID-related items that are imported for government donations or on the recommendation of the state authority to any relief agency from integrated GST, until August 31. The 44th meeting of the GST Council was attended by the Minister of State Finance Anurag Thakur, as well as the finance ministers of the states and territories of the Union and senior officials of the government and states of the Union.