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FM Sitharaman announces GST exemption for expensive drugs

The Goods and Services Tax (GST) Council has extended the concessions to specified drugs used in COVID-19 treatment till December 31, sources told CNBC-TV18 on Friday.

The development comes as the 45th GST Council meeting, the first physical meet since the outbreak of the COVID-19 pandemic, chaired by Union Finance Minister Nirmala Sitharaman is underway.

According to sources, the council has also approved adding more medicines under concessional rates and has extended the relief by reducing GST rates from 12 percent to 5 percent on several drugs till December 31. These include Itolizumab, Posaconazole, Infliximab, Bamlanivimab & Etesevimab, Casirivimab & Imdevimab, 2-Deoxy-D-Glucose and Favipiravir.

The council had earlier recommended GST rate reduction till September 30 on certain items used in COVID-19 treatment along with four medicines— Amphotericin B (5 percent to nil), Tocilizumab (5 percent to nil), Remdesivir (12 percent to 5 percent) and anti-coagulants like Heparin (12 percent to 5 percent).

Meanwhile, the council has refused to allow Sikkim to levy 1 percent COVID-19 cess on intra state supply of pharma items for three years, according to sources.

Sources added that the Council is in favour of Aadhaar authentication being mandatory for taxpayers to claim a refund or revoke cancellation of registration. The Aadhaar authentication of existing taxpayers will be done in a phased manner, they said.

The panel has also agreed to notify as the Common Goods and Services Tax Electronic Portal.

The GST Council will also clarify issues relating to the export of services condition (v) of Section 2 (6) of the IGST Act 2017. This comes against the backdrop of refund claims of exporters of services being rejected by field formations following which demands are being issued seeking to recover the past refunds. The council will clarify on intermediaries, sources said. CNBCTV18

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