The GST Council on Saturday cleared the GoM's (Group of Ministers) recommendation on tax slab on vaccines and other COVID-19 essential items. The meeting chaired by Union Finance Minister Nirmala Sitharaman slashed taxes on hospital equipment, medicines, and other items.
The GST Council consented to stick to 5% tax rate on vaccines, while GST on ambulances has been cut to 12% from 28%, and on electric furnaces and temperature-checking equipment to 5%. Pulse oximeters, hand sanitisers, temperature check equipment and ambulances too will attract lower 5 per cent tax, while that on ambulances has been reduced to 12% from 28%.
Tax on medical grade oxygen, oxygen concentrators, ventilators, BiPAP machines and high flow nasal cannula (HFNC) devices has also been cut to 5 per cent from 12 per cent. Tax on Covid testing kits has been brought down to 5 per cent from 12 per cent.
The tax cut is based on recommendations of GoM (Group of Ministers) amid the COVID-19 pandemic. Addressing a press conference after the GST Council meeting, FM Sitharaman said no tax will be imposed for medicines like Amphotericin B and Tocilizumab, used for treating Black Fungus (mucormycosis). While GST on Tocilizumab and Amphotericin B is slashed to nil from 5 per cent, the rate on Remdesivir and anti-coagulants like Heparin is lowered from 12 per cent to 5 per cent.
"Five per cent GST on vaccines continues. The Centre will buy 75 per cent of vaccines as announced earlier and will also pay its GST. However, 70 per cent of income from GST will be shared with states," Finance Minister Nirmala Sitharaman said.
"The GST on electric furnaces and temperature checking equipment was brought down to 5 per cent and on ambulances to 12 per cent. These rates will be valid till September as against August end recommended by the GoM," she added.
She added that the tax cuts are valid till September 30 (2021) as against August-end recommended by the GoM, however, the decision to extend the relief will be taken during the GST meet in that month.
"GST rates have been decided for four categories of products- medicines, oxygen, oxygen-generation equipment, testing kits and other machines and other Covid-19-related relief material," FM Sitharaman noted.
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