44th GST Council Meeting Updates: GST rate cut down for COVID-19 medical supplies

The GST rate for Covid testing kits, medical-grade oxygen and ventilator has been reduced from 12 percent earlier to 5 percent.

Created On: Jun 13, 2021 17:40 ISTModified On: Jun 13, 2021 17:41 IST
GST Council

Finance Minister Nirmala Sitharaman chaired the 44th meeting of the Goods and Services Tax (GST) Council on June 12, 2021.

The Union Finance Minister informed that the GST Council has accepted the recommendations of the Group of Ministers (GoM) set up to look into tax relief on Covid-19 medical supplies.

44th GST Council: Key Decisions

• The GST Council has decided to reduce the Goods and Services Tax (GST) rate for ambulances from 28 percent to 12 percent.

• The GST rate for COVID-19 testing kits, medical-grade oxygen and ventilator has also been reduced from 12 percent earlier to 5 percent.

• The GST rate for hand sanitisers has been reduced from 18 percent to 5 percent. 

• The GST rate for temperature check equipment has been reduced from earlier 18 percent to 5 percent.

• The GST rate on pulse oximeters, including personal imports, has been reduced from earlier 12 percent to 5 percent. 

• The GST rate on specified inflammatory diagnostic kits has also been reduced from 12 percent to 5 percent.

• The GST rates on gas/electric/other furnaces for crematorium including their installation has been cut from earlier 18 percent to 5 percent.

• The GST Council also decided not to impose any GST on Covid-19 related drugs including Tocilizumab and Amphotericin B. The GST rate on the drugs earlier was 5 percent.

• The GST rates on anti-coagulants like Heparin and Remdesivir have also been reduced from earlier 12 percent to 5 percent.

• Further, the GST Council decided that any other drug recommended by the Ministry of Health and Family Welfare (MoHFW) and the Department of Pharma (DoP) for Covid treatment will attract a GST tax rate of just 5 percent. 

• The GST Council also decided to give relief to ventilator masks/canula/helmets by reducing the tax rate from earlier 12 percent to 5 percent. 

• The GST rate for BiPAP machine has also been brought down from 12 percent to 5 percent. 

• The GST rate for high flow nasal cannula (HFNC) device has also been brought down from 12 percent to 5 percent.

Finance Minister Sitharaman announced that these rates will be valid till September 30, 2021 instead of August-end recommended by the Group of Ministers. 

She further said that the GST Council will take the decision on whether to extend the period further nearer the time, based on the advice from states.

Background 

The GST Council had during its meeting on May 28, 2021 recommended full exemption from IGST on several specified COVID-19 related goods such as medical oxygen, oxygen concentrators and other oxygen storage and transportation equipment and COVID-19 vaccines and certain diagnostic markers test kits. 

The GST Council had decided to constitute a Group of Ministers (GoM) for individual items to go into the need for further relief to COVID-19 related individual items immediately.

The Council had 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.

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