44th GST Council meeting: GST rate cut on COVID essentials up to 30th September 2021
GSTR-9

Union FM Nirmala Sitharaman chaired the 44th GST Council meeting today, exactly two weeks after the 43rd GST Council meeting on 28th May 2021. A major decision has been taken to reduce the GST rates charged on COVID-19 fighting essentials such as ambulances, the Remdesivir medicine, electric furnaces, temperature checking equipment, etc.

The meeting began around 11 a.m. on 12th June 2021 and concluded around 3:15 p.m. Soon after that, the Union FM briefed the media about the outcome of the meeting. In the address, FM announced that the GST Council had accepted the GST rationalisation measures proposed by the Group of Ministers (GoM) without much contention. Further, the GST rate on ambulances was reduced from 28% to 12% against the earlier proposal of GoM to keep it unchanged. Likewise, two other items, electric furnaces and temperature checking equipment, also underwent rate cuts from 18% to 5%. 

The GST rates were retained without changes on the COVID-19 vaccines at 5%, N95, and surgical and other triple-layer masks remain taxed at 5% GST. Further, the RT-PCR machines and PPE kits continue to be levied GST at 18% and 5%, while the genome sequencing kits shall remain taxed at 12%. Moreover, the portable hospital units shall remain taxed at 18%.

The following are the rate revisions recommended by the GST Council and shall be valid until 30th September 2021, after being notified by the CBIC. Earlier, the proposal was to give relief up to 31st August 2021.

Firstly, the GST rates on the following items have been reduced to nil or ‘0’%.

Items Current rate New rate
Tocilizumab medicine used in COVID treatment 5% Nil
Amphotericin B used in Black Fungus treatment 5% Nil

Note that the GST rate on COVID vaccines remains unchanged at 5%, in line with the recommendation of the GoM. Union FM reiterated that 75% of the vaccination procurement is being arranged by the Centre, distributing or inoculating the public free of cost. Hence, GST on vaccines will have the least impact on the common people. 

Next, the GST rates on the following items have been reduced to 5%:

Items Current rate New rate
COVID testing kits 12% 5%
Remedesivir 12% 5%
Purchase of pulse oximeters in India or Import from abroad for personal use 12% 5%
Heparin and other anticoagulants 12% 5%
Medical grade oxygen 12% 5%
Ventilators and Ventilator masks/cannula /helmet 12% 5%
BiPAP Machine 12% 5%
High-flow nasal cannula (HFNC) device 12% 5%
Specified Inflammatory Diagnostic Kits, namely D-Dimer, IL-6, Ferritin and LDH 12% 5%
Hand Sanitizer 18% 5%
Temperature checking devices 18% 5%
Gas/electric/other furnaces for the crematorium, including their installation, etc. 18% 5%

Also, any other drugs prescribed by the Health & Family Welfare Ministry of India (including the Department of Pharma) for COVID-19 treatment shall be reduced to a 5% GST rate.

Lastly, the GST rates on ambulances were reduced from 28% to 12%. The CBIC must notify the revised GST rates for their applicability up to 30th September 2021

For any clarifications/feedback on the topic, please contact the writer at annapoorna.m@cleartax.in

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