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Summary of Key Decisions from the 44th GST Council Meeting

The 44th GST Council Meeting, held on June 12, 2021, primarily focused on reducing GST rates for essential COVID-19 medications and medical supplies. Chaired by the Union Finance Minister, the council's decisions followed a report from a Group of Ministers formed to assess these reductions. These temporary rate changes aimed to ease the burden during the pandemic and were applicable to newly manufactured stock until September 30, 2021.

📖 2 min read read🏷️ GST Council Meetings

The 44th Goods and Services Tax (GST) Council convened on June 12, 2021. Following this gathering, Finance Minister Smt. Nirmala Sitaraman revealed plans to establish a Group of Ministers (GoM). This group would assess potential further tax reductions and new exemptions for items crucial to COVID-19 management and the treatment of Black Fungus. The Union Finance Minister presided over the 44th GST Council meeting. Key attendees included Shri Anurag Thakur, Union Minister of State for Finance and Corporate Affairs, along with finance ministers from various states and Union Territories, and other senior officials from both the Ministry of Finance and the respective state and UT administrations.

Recent Updates on GST Council Meetings

  • June 24, 2022: The 47th GST Council meeting occurred on June 28 and 29, 2022, in Chandigarh. Chaired by Union Finance Minister Nirmala Sitharaman, this meeting included proposals to adjust rates for increased revenue and to address inversion issues, simultaneously streamlining the GST exemption list. Additionally, relief for compliance was extended to e-commerce providers and taxpayers under the composition scheme.
  • December 29, 2021: The 46th GST Council meeting was held in New Delhi on December 31, 2021. During this session, led by Union Finance Minister Nirmala Sitharaman, a decision was made to postpone the increase of the GST rate for textiles to 12%.
  • September 1, 2021: The 45th GST Council meeting convened on September 17, 2021. Key items on the agenda included extending tax concessions for COVID-19 essential goods, discussing GST compensation for states, and correcting the inverted tax structure.
  • May 28, 2021: The 43rd GST Council meeting took place on May 28, 2021. The Council endorsed the reintroduction of the GST amnesty scheme, streamlined late fees for all taxpayers (especially smaller ones), and exempted IGST on imported COVID-19 treatment equipment and relief supplies until August 31, 2021.

Key Outcomes of the 44th GST Council Meeting

The 44th GST Council decided to decrease the GST rates on various medications and medical provisions essential for COVID-19 treatment. These revised rates or exemptions were applicable until September 30, 2021, and specifically applied to newly produced stock. The following tables detail the newly implemented GST rates:

Medicines required for COVID-19 and Black Fungus treatment:

ItemsOld rateProposed rate
Tocilizumab5%Nil
Amphotericin-B5%Nil
Remedesivir12%5%
Anti-coagulants like Heparin12%5%
Any other drug (recommended by the Ministry of Health and Family Welfare (MoHFW) and the Dept. of Pharma (DoP) for COVID-19 treatment)Existing rate5%

Medical equipment required for COVID-19 treatment:

ItemsOld rateProposed rate
Medical Grade Oxygen12%5%
Oxygen concentrators/ generators (which include personal imports)12%5%
Ventilators and ventilator masks/ cannula/ helmets12%5%
BiPaP machine12%5%
High flow nasal cannula device12%5%
Pulse oximeters12%5%

COVID-19 testing kits and items utilised for the prevention of COVID-19

ItemsOld rateProposed rate
COVID-19 testing kits12%5%
Specified Inflammatory Diagnostic Kits, namely D-Dimer, IL-6, Ferritin and LDH12%5%
Hand sanitiser18%5%
Temperature checking equipment18%5%

Others:

ItemsOld rateProposed rate
Gas/electric/other furnaces for crematoriums, including their installation, etc18%5%
Ambulances28%12%

Anticipations Prior to the 44th GST Council Meeting

A Group of Ministers (GoM) was established on May 29, 2021, tasked with evaluating the necessity of lowering GST on essential COVID-19 items. The GoM submitted its findings to the Finance Ministry by June 8, 2021. The primary focus of the 44th GST Council meeting was to deliberate on this GoM report and determine if GST rates on COVID-19 essentials should be decreased. Reports indicated that the GoM suggested maintaining the current 5% GST on COVID-19 vaccines and put forward the subsequent new GST rates for other vital COVID-19 supplies:

Medicines required for COVID treatment:

ItemsCurrent rateProposed rate
Tocilizumab5%Nil
Amphotericin-B5%Nil
Remedesivir12%5%
Anti-coagulants12%5%
Medical O212%5%

Also, any other drug prescribed by the Health Ministry for COVID treatment shall be reduced to a 5% GST rate.

Medical equipment required for COVID treatment:

ItemsCurrent rateProposed rate
Oxygen concentrator12%5%
Ventilators and ventilator masks12%5%
BipAp machine12%5%
HF nasal canula device12%5%
Pulse oximeters12%5%

COVID testing kits and items utilised for prevention of COVID-19:

ItemsCurrent rateProposed rate
COVID testing kits12%5%
Genome sequencing kits12%No change
RT-PCR machines18%No change
PPE kits5%No change
N95, surgical and other triple-layer masks5%No change
Hand sanitiser18%5%
Temperature equipment18%12%

Other necessities:

ItemsCurrent rateProposed rate
Crematorium furnaces18%12%
Portable hospital units18%No change
Ambulances28%No change

The current and expected GST exemptions and rate reductions were anticipated to be valid until August 31, 2021.

Further Reading

Frequently Asked Questions

What is the Goods and Services Tax (GST) in India?
The Goods and Services Tax (GST) is an indirect tax used in India on the supply of goods and services. It is a comprehensive, multi-stage, destination-based tax that is levied on every value addition.
How many types of GST are applicable in India?
In India, there are four main types of GST: Central GST (CGST), State GST (SGST), Integrated GST (IGST), and Union Territory GST (UTGST). CGST and SGST/UTGST are levied on intra-state supplies, while IGST is levied on inter-state supplies.
Who is required to register for GST in India?
GST registration is mandatory for businesses whose aggregate turnover exceeds a specified threshold limit (which varies based on state and nature of supply, e.g., ₹20 lakhs or ₹40 lakhs for goods, and ₹10 lakhs or ₹20 lakhs for services). Certain businesses, like those involved in inter-state supply or e-commerce operators, must register regardless of turnover.
What is an Input Tax Credit (ITC) under GST?
Input Tax Credit (ITC) allows businesses to reduce the tax they pay on output by the tax they have already paid on inputs. It prevents the cascading effect of taxes, ensuring that tax is levied only on the value added at each stage of the supply chain.
How are GST rates determined in India?
GST rates in India are determined by the GST Council, a joint forum of the Centre and States. The Council categorizes goods and services into different tax slabs (e.g., 5%, 12%, 18%, 28%) and makes recommendations on rates, exemptions, and other GST-related matters.
What was the primary focus of the 44th GST Council Meeting?
The 44th GST Council Meeting primarily focused on reviewing and reducing GST rates for essential COVID-19 related drugs and medical supplies, following recommendations from a Group of Ministers.

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