Ministry of Finance Notifies Concessional GST Rate on COVID-19 Relief Material

The Ministry of Finance has notified the preferential rate of GST that will be applicable on COVID relief materials until September 30, 2021. In addition, a lower Goods and Services Tax (GST) of 5 percent will be applicable to contracts work for the construction, repair or maintenance of electric ovens intended for the funeral, burial or cremation of the deceased.

The previous tax rate for this service was 12 percent. On June 12, the GST Council, chaired by Finance Minister Nirmala Sitharaman and composed of ministers of state, reduced the tax rate on COVID drugs such as Remdesivir and Tocilizumab as well as on medical oxygen , oxygen concentrators and other essential COVID products.

On June 14, the Ministry of Finance’s revenue department notified tariff cuts for 18 COVID-related supplies, such as hand sanitizer, pulse oximeters, the BiPAP machine, test kits, ambulances and temperature control equipment. These preferential rates would be applicable until September 30, 2021, he added.

The Council, at its meeting on June 12, had decided to reduce the GST on the COVID-19 drug Tocilizumab and the black fungus drug Amphotericin B to “nil”, by 5%. The level of Remdesivir and anticoagulants like heparin is lowered from 12% to 5%.

The council also decided to reduce the GST rate on ambulances from 28 percent to 12 percent. The tax on medical grade oxygen, oxygen concentrators (including personal imports), ventilators, BiPAP machines, and high-flow nasal cannula (HFNC) devices has been reduced from 12% to 5% .

In addition, the tax on COVID test kits, pulse oximeters (including personal imports) has been reduced from 12% to 5%. Hand sanitizers, temperature control equipment, gas / electric ovens for crematoriums will also be subject to a lower tax of 5%, down from 18% previously.

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