The Centre proposed cuts on Saturday in Goods and Services Tax rates on medicines and equipment used for the treatment Covid-19. The proposal reduced tax rates on medical-grade oxygen, concentrators, ventilators, and BiPAP machines from 12% to 5%. The proposal also suggests no tax on Covid-19 medicines Tocilizumab and Amphotericin-B, which are used to treat cases of mucormycosis or “black fungus”.

The GST rates on the antiviral drug remdesivir, Covid-19 testing kits, inflammatory diagnostic kits like D-Dimer, IL-6, and Ferritin, and pulse oximeters will be slashed down from 12% to 5% under the new proposal. Tax rates on hand sanitisers, temperature checking equipment, and electric furnaces used in crematoriums will be reduced from 18% to 5%. GST on ambulances are proposed to be reduced from 28% to 12%.

The tax relief will be applicable till September 30, Finance Minister Nirmala Sitharaman announced after chairing the 44th meeting of the GST Council. The new tax brackets are based on the recommendations of a Group of Ministers.

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“The Group of Ministers had recommended changes till August, but after discussions with the [GST] Council it has been extended till September,” Sitharaman said during a press briefing. “Based on the advice and inputs from states, whether that period has to be further extended, a call will be taken nearer to the time.”

There will be no change in the 5% tax on Covid-19 vaccines, the council has proposed. “When it [tax on vaccines] was discussed, it was mentioned that the Centre is buying 75% of the vaccines and will remit the GST on it and 70% of the revenue on that will be shared with the states,” Revenue Secretary Tarun Bajaj said, according to The Hindu.

The Centre’s announcement came amid acute shortages of medical supplies in India in the middle of the devastating second wave of the Covid-19 pandemic. On Saturday, India reported 84,332 new coronavirus cases, taking its overall tally to 2,93,59,155 since the pandemic broke out in January 2020. For the fifth consecutive day, the country recorded less than one lakh cases. Deaths rose by 4,002 and stood at 3,67,081.

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