Tax Relief

Life-saving medicine towards Covid obtain tax breaks

In its meeting on Friday, the GST Council rejected the proposal to bring gasoline and diesel under the uniform indirect taxation. Meanwhile, the council extended GST relief for four drugs related to the treatment of Covid-19 through December 31 and announced tax cuts on other life-saving drugs.

The council met in Lucknow for its first physical session in 20 months – the last was on December 18, 2019 – with a full agenda. Finance Minister Nirmala Sitharaman chaired the meeting.

To the disappointment of many, the widespread demand to bring gasoline and diesel under the GST has been rejected by the states. Including gasoline and diesel under the goods and services tax (GST) would remove the state taxes levied on them, which is expected to lower prices sharply.

Check out live updates on the decisions of the 45th GST Council meeting here:

  • No new tax on food deliveries from platforms like Zomato, Swiggy. Instead of restaurants, aggregators are now collecting GST from customers and paying them to the government. This was done through leaks in the GST collection from the restaurant.
  • Two GoMs were formed to deal with tariff rationalization issues like the GST and another to deal with e-waybills, FASTags, etc.
  • Collection procedure to repay the loans taken out for compensation by March 26, 2020.
  • Petroleum products to be included in the GST have been brought before the council following a decision by the Kerala Supreme Court. States rejected this request. The Council decided to report to the court.
  • The GST for railroad locomotives, parts and others rose to 18 percent.
  • To reduce inversion and support domestic production, 12 percent GST is recommended for certain renewable energy devices.
  • All types of pens and their parts must be taxed at 18 percent to correct the reverse.
  • Changes to the GST rate to implement a reverse tariff structure correction as in the shoe and textile sector from January 2022.
  • Airport and other leased goods exempt from double taxation. IGST is excluded. This will also be allowed for landlords based in SEZ.
  • GST exempt qualification programs that are fully funded by state and central governments. Training programs where the state pays 75 percent or more of the costs are also excluded.
  • National approval fee levied by states for goods carriers exempt from the GST.
  • Transport of export goods by ship and air freight GST exemption extended for another year.
  • GST rates for biodiesel for admixture with diesel reduced to 5 percent.
  • Fortified rice grains for ICDS programs reduced to 5 percent.
  • Retrofit kits for vehicles used by Divyangs reduced to 5 percent.
  • Cancer-related drugs like Keytruda and others reduced.
  • GST rate lowered from 12 percent to 5 percent for seven other drugs recommended by the Department of Health
  • Extended GST relief for Covid drugs Amphotericin-B, Tocilizumab, Remdesivir and anticoagulants such as heparin until December 31. No renewal for other devices in the previous list.
  • Medicines proposed by the Ministry of Health for the treatment of muscular atrophy imported for personal use are excluded.
  • According to FM Sitharaman, the very expensive life-saving drugs Zolgensma and Viltepso are exempt from GST.
  • Some of the long-pending decisions have been resolved today, says FM Nirmala Sitharaman.
  • GST Council meeting still ongoing.

As the GST Council meeting is still in progress, the press conference has been delayed a bit. The briefing begins after the GST Council meeting. Inconvenience is regretted. https://t.co/sU1gxGUKhT

– Ministry of Finance (@FinMinIndia) September 17, 2021

  • All eyes are on whether the Council decides to bring petrol and diesel within the scope of the GST or not. Voices in support of this demand have grown strong in the recent past as fuel prices have exceeded each other 100 per liter in several cities.
  • Finance Minister Nirmala Sitharaman will speak at 6:30 p.m. on the decisions made during the 45th GST Council meeting.

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