Finance Minister Nirmala Sitharaman has said, full exemption from Customs duties, including IGST, is already available to all COVID relief material imported by Indian Red Cross for free distribution in the country. In a series of tweets, the Minister said that from 3rd May, full exemption from all duties has been provided to Remdesivir injections, Remdesivir API, and for a chemical for the manufacture of this drug. She said this in response to letter written by West Bengal Chief Minister Mamata Bannerjee to Prime Minister Narendra Modi seeking exemption from GST and Customs duty and other duties and taxes on some items and COVID related drugs.
Ms Sitharaman said, this exemption applies to goods such as Medical Oxygen, equipment used for the manufacture, storage and transportation of oxygen, equipment used for providing oxygen therapy to COVID patients, when imported free of cost for free distribution in the country by any entity, State Governmentt, relief agency or autonomous body on the basis of a certificate issued by a State Government.
In order to augment the availability of these items, Government has also provided full exemption from basic customs duty and health cess to their commercial imports. GST at rates varying from 5 percent on vaccines to 12 percent on COVID drugs and oxygen concentrators is applicable to domestic supplies and commercial import of these items. If IGST of 100 rupees is collected on an item, 50 rupees accrues to the Centre and the States each as CGST and SGST. Further 41 percent of the CGST revenue is devolved to States.
The Minister said, if full exemption from GST were given, the domestic producers of these items would be unable to offset taxes paid on their inputs and input services and would pass these on to the end consumers by increasing their price. She said, COVID vaccines are being provided free of cost by the Centre to those who are 45 years of age and above and to all frontline workers. The Minister said, if full exemption from GST is given, vaccine manufacturers would not be able to offset their input taxes and would pass them on to the end consumer or citizen by increasing the price.
WhatsApp us