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BW Businessworld

GST Rates Slashed For Furnaces, Ambulance, Covid-Essentials

Finance Minister today announced GST rate cuts in line with the GoM recommendations on a slew of Covid-essentials; vaccines would continue to attract 5 percent GST

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After chairing the GST Council meeting Finance Minister Nirmala Sitharaman on June 12 announced tax cut on electric cremation furnaces, ambulances and temperature checking devices (now at 5 per cent).

The decision to reduce the tax rates on key medical and related products was taken during the meeting of the GST Council held earlier in the day via a video conference.

As reported earlier, a Group of Ministers (GoM) was formed after the last GST Council meeting on May 28 to deliberate on possible reductions in COVID-related items.

Briefing the reporters after the GST Council meeting, the FM said: "The GST Council has approved rate reduction for Remdesivir from 12 percent to 5 percent and a nil tax would be charged on Tocilizumab," the FM said.

Sitharaman announced that the GoM's recommendation on bringing down rates on certain Covid-19 essentials have been accepted. "The new rates will remain in effect till September 30," the FM told reporters at a press briefing.

"Five percent GST on vaccines will stay. The Centre will buy the 75 percent vaccine as announced and will pay its GST too. But 70 percent of income from GST will be shared with states," Sitharaman said.

The FM had already clarified that waiving off the GST on vaccines would compel the vaccine manufacturers to raise the cost of the vaccine in order to offset the impact of input taxes.

The FM explained that the revised GST rates were decided for four categories of products—Covid-related medicines, oxygen, oxygen-generation equipment, testing kits and other machines and other COVID19 related relief material. "Rates will be  announced soon," Sitharaman said.