The meeting of the GST Council is being held after 8 months.
The 43rd meeting of the GST Council led by Finance Minister Nirmala Sitharaman is being held through video conference.
New Delhi. The meeting of the GST Council began on Friday, in which it will be considered to reduce the tax rate on Kovid-related materials such as medicines, vaccines and medical equipment. Apart from this, the modalities to compensate the revenue loss to the states will also be discussed in the meeting. The 43rd meeting of the Council led by Finance Minister Nirmala Sitharaman is being held through video conference. This is the first meeting of the council in about 8 months.
Ahead of the meeting, non-BJP ruled states such as Rajasthan, Punjab, Chhattisgarh, Tamil Nadu, Maharashtra, Jharkhand, Kerala and West Bengal have prepared a joint strategy to press for zero tax rate on essential items related to Kovid.
The council consists of representatives of all the states and union territories.
The GST Council consists of representatives from all the states and union territories. Apart from discussing the tax rates, there will also be a discussion on providing an estimated amount of Rs 2.69 lakh crore to the states in the council. While implementing the GST system in the year 2017, the states were promised to compensate for their revenue loss by persuading them to give up their right to levy VAT and other taxes. Sources said that the fitment committee on GST rates gave the council the covid vaccine, Submitted a report on the merits of reducing the rate of tax on drugs and other devices to zero. This committee includes tax officials from the Center and the states.
If the final product is exempted from GST, the manufacturer will be left with no option to claim the benefit of input tax credit on the raw material. In this case, the consumers will not get any special benefit. In the year 2018, the council had made sanitary napkins GST-free on the demand of many women’s organizations. It was taxed at the rate of 12 per cent. But after the GST was exempted, the consumers did not get any significant benefit as the manufacturer did not get the benefit of refund of the tax charged in the supply chain.
GST at the rate of 5% on import of vaccines
Finance Minister Nirmala Sitharaman earlier this month rejected the demand for exemption from GST for vaccines, medicines and oxygen concentrates related to Kovid, saying that due to such exemption, these life-saving items would be costly for the consumers. Because its manufacturer will not be able to get the benefit of tax paid on raw materials. At present, domestic supply of vaccines and commercially imported GST attracts GST at the rate of 5 per cent, while GST at the rate of 12 per cent is applicable on COVID drugs and oxygen concentrators.