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Medical devices not used for COVID vax to attract 18% GST

A tax ruling has said that unless products and equipment are additional taxation should be attracted unless the product or device is specially manufactured for the sole purpose of Covid vaccination. Tax experts say this will raise the Goods and Services Tax (GST) for the equipment used in the Covid vaccination program.

According to the ruling, the manufacture of cold chain equipment used in vaccination and immunization programs to transport vaccines, specimens and blood samples should attract 18% of GST, Uttar Pradesh Pre-Arbitrage (AAR) Says.

“The ruling depends more on the composition of the product than on the use or consumption of the product by dealers and customers. The composition is not the only criterion, but one of the criteria used to determine the classification. Some may do, “said partner Harpreet Singh. , Indirect tax at KPMG in India.

The ruling stated that not all devices can be classified as medical or surgical instruments and devices according to the definitions of vaccine carriers and vaccine cold boxes available on the UNICEF website. A ruling released in December stated that all devices need to attract similar GST rates unless specifically designed for the sole purpose of Covid vaccination. “Currently, Covid vaccines are highly socially relevant, so an 18% higher GST for vaccine carriers could increase the price in the hands of the end consumer if the company decides to shift the burden. “Singh added.

AAR ruled that “UNICEF treats it in the same way as heat-insulated containers, so we have determined that the target products can be properly classified.” Covid’s pandemic has caused some GST problems for businesses. India News Republic

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