Reducing
taxes on life-saving medicines, bringing in petrol and diesel in the face of
indirect taxes, arguing for an inverse duty structure, and using food
distribution as your restaurant services were some of the highlights of the
agenda. In this article let’s go through A Complete highlights of 45 GST council
meeting.
Finance
Minister Nirmala Sitharaman presided over the 45th meeting of the Goods and
Services Tax (GST) Council in Lucknow on Friday. It was the council's first
private meeting in about two years since the Covid-19 epidemic began.
Reducing
taxes on life-saving medicines, bringing in petrol and diesel in the face of
indirect taxes, arguing for an inverse duty structure, and using food distribution
as your restaurant services were some of the highlights of the agenda. Here's
what you need to know:
Tax rebates on Medicines:
FM
Sitharaman inaugurated the conference by announcing the decision of the GST
Council to provide tax rebates on life-saving drugs. Moreover, Amphotericin B,
Tocilizumab will not have any GST until December 31 this year.
The discounted GST rate on
Covid-related drugs, which was until September 30, has now been increased to
December 31 only for medicines, but not for medical devices. Proposals to
reduce GST on 7 drugs by 12% to 5% by December 31, 2021, have also been
approved: Itolizumab, Posaconazole, Infliximab, Bamlanivimab and Etesevimab,
Casirivimab and Imdevimab, 2-Deoxy-D-Glucose and Favipiravir.
The FM said
some life-saving drugs are not compatible with Covid-19, but they are
expensive, which is being waived. He added that Zolgngelsma and Viltepso,
valued at about Rs 16 crore, would now be exempt from GST.
The GST on
retro-fit kits for vehicles used by the differently-abled has been reduced by
0% and the drugs prescribed by the Ministry of Health for muscle atrophy
treatment have been exempted from IGST.
Petrol and diesel:
The GST Council has not yet made a
final decision on the proposal to bring petrol under the GST. Sitharaman said it
was not the right time to do so and was produced before the council due to the
Kerala HC order. The GST
Council will return to court with its arguments.
According to state sources, the state
government has strongly opposed the inclusion of fuel in the meeting, citing
concerns over revenue growth during the meeting. When the GST Registration was introduced in July
2017, the revenue dependence of five commodities, including crude oil, natural
gas, petrol, diesel and aircraft turbine fuel (ATF), was taken into account.
"We are
not saying that we should not bring petrol and diesel under GST
immediately," a government official told TOI ahead of an important meet.
Food delivery platform:
In the report on the GST on food
orders from Zomato NSE 1.02 % and Swiggy, The FM said that there are no new
taxes. He added
that e-commerce operators Swiggy and Zomato had to pay GST on restaurant
services provided through them and pay taxes during distribution. It has been
decided that operators and gigs such as Swiggy will be subject to GST on the
place where food is distributed and where tax is collected Sitharaman said.
After such
meetings, Sitharaman said, such food distribution apps now have to collect 0%
GST from customers instead of restaurants. Now aggregators like Zomato and
Swiggy will bear the tax burden that was previously provided by the restaurant.
End-users still don’t have to pay anything extra.
Other Highlights of 43 GST council Meeting:
The FM has
announced that two ministerial teams will be formed to bring about some changes
in the GST system. One group will look at the rating rationale and submit a
report within two months, while the second group will look at issues related to
e-way bills, Fastags, technology, compliance, composition schemes.
It was also
said that the GST compensation would have to be extended by March 2026.The GST
Council has waived the national tariffs imposed on states for the
transportation of goods. GST rate reduction on biodiesel - supplied to OMC for
mixing with diesel - also announced from 12% to 5%.
The council
has approved an increase in GST on railway parts and locomotives from the
current 12% to 18%.A reverse duty scheme on shoes and clothing will be amended
from January 1, 2022, Sitharaman said. 12% GST will now apply to certain
renewable devices and pens will now attract an 18% single GST rate.
The GST rate on
fortified rice kernels, which can be used in the Integrated Child Development
Services Scheme, has been reduced from 18% to 5%.
