TaxTMI 
TaxTMI 
Minutes of the 44th Meeting of the GST Council held on 12th June 2021
X X X X Extracts X X X X
X X X X Extracts X X X X
....ration: • First, to extend the scope of the ad hoc exemption notification to include the import of COVID related materials on payment basis and provided free to the people, to the State/ Centre or State agencies. • Second, to include certain more COVID related items and reduce taxes on them. 2.2 There was consensus on the first item in the said meeting and the notifications have already been issued, which provides for exemption for individuals and institutions who import COVID related notified items on payment basis and provide these free of cost for COVID relief. 2.3 On the second item, there were different viewpoints and accordingly, a Group of Ministers (GoM) was constituted on 29/05/2021 with Hon'ble Chief Minister of Meghalaya as the Convenor with Members from seven other States. In total, there were eight Members including the Convenor (Annexure A). 2.4 He then requested the Hon'ble Chief Minister of Meghalaya being the Convenor of the GoM to present the report along with the recommendations of the GoM to the Council. 3. The Hon'ble Member from Meghalaya and the Convenor of GoM thanked the Hon'ble Chairperson for providing him the opportu....
X X X X Extracts X X X X
X X X X Extracts X X X X
....uld impact that adversely and therefore they had decided not to opt for zero-rating or a 0.1% rate. The GoM discussed each of the items individually and broadly categorized them into live categories as follows and presented their recommendations: A. Vaccines B. Medicines C. Oxygen, oxygen generation equipment, and related medical devices D. Testing kits and machines, and E. Other covid-19 related relief materials He then presented the recommendations of the GoM based on the discussions on these goods as detailed below. 3.5 Vaccines He stated that for vaccines, the GoM opined that there should not be any change and it should remain at 5% only as mentioned earlier. Though some of the States in the GoM had suggested that the GST rate should be brought down, but for the reasons mentioned earlier, it was felt that it would create more issues in the long-run. Besides, the direct impact to the end consumers was not there as the Centre and the State Governments were procuring most vaccines. Further, as it has recently been decided that the Central Government would be procuring all the vaccines and paying for the same, there would ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....r from Goa had suggested that even 6% is a large decrease but post discussions, it was decided to reduce the rate to 5%. There was a concern that other similar products may also be impacted and people might ask for relief on those products as well. However, the GoM opined that if relief was given in a time bound manner, then it would not have too much of an impact on other complementary products. In the case of pulse oximeters, it was felt that relief could be given on it in a time bound manner by bringing down the rate from 12% to 5%. Similarly, for temperature check equipment there were recommendations to reduce the rate by 6% (from 18% to 12%). Regarding gas/ electric and other furnaces for crematorium, there was also a Court case and the GoM had been asked to give recommendation on it. Therefore, considering not just the current situation which the country was facing but also long-term environmental impact, it was recommended to reduce rates on them from 18% to 12%. Most of the items like PPE kits, N95 masks were already in the lower rate bracket (i.e., 5%) and therefore no change was recommended on these. In the case of ambulances, being an automobile, it was opined that th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tc. He stated that the demand pertaining to reducing the rates on thermometers and hand sanitizers was first made by Bihar and the GoM had accepted that and for that he expressed his gratitude towards the Hon'ble Chairperson and the Members of the GoM. He thanked GoM for reducing the rates on gas/ electric and other furnaces for crematorium for which a request had been made by him. This report took care of the domestic manufacturers as well. Simultaneously, reducing the rates on medicines needed for the treatment of COVID, as recommended by the Union Ministry of Health and Family Welfare of the Union of India would give great relief to the public. He expressed full support for the GoM recommendations and requested the Council to accept it with consensus and implement the recommendations to provide relief to the maximum people at the earliest. 7. Hon'ble Member from Manipur stated that the GoM had taken into consideration the deliberations which took place in the 43^rd GST Council meeting. He stated that there were numerous demands for zero-rating and a 0.1% rate but the Convenor of the GoM had explained that with a view to promoting the manufacturing sector and developing the ec....
X X X X Extracts X X X X
X X X X Extracts X X X X
....healthcare policy in India as far as taxation was concerned. He then stated that it was being debated whether to restrict vaccines only for Government hospitals as private hospitals would probably make a profit, but the hospitals were treating people and it would be difficult for them to get registration and start billing 2.5% CGST and 2.5% SGST and then file returns. The optics of the GST being in the final bill were not good and as profit had been restricted to only Rs. 150 on vaccination, there was no rationale in saying that the hospitals would be making profit on vaccination. He further stated that he did not think that the Council would want the revenues to come from crematoriums and cremation services. Similarly, in RT- PCR machines it had been decided to retain the rate of 18%. He stated that even if these machines were bought at concessional rates, most State Governments had set the rates and he did not think Profiteering was possible in this. He stated that he was in favour of zero-rating or a 0.1% rate. He suggested that exemptions may be given till 31^st March, 2022. He stated that he would not be able to go along with the proposals of the GoM. He requested for the appo....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... and to continue the existing welfare schemes and announce new schemes. He disagreed with the proposals given by the GoM and stated that if not zero-rated then at least a 0.1% rate should be considered and that it would not impact the finances of the Government much. 13. Hon'ble Member from Himachal Pradesh thanked GoM for coming up with the recommendation in a very short span of time. He stated that their recommendations on the one hand gave relief to the people in these difficult times and on the other hand also took care of the domestic manufacturers in the long run. He fully supported the recommendations of GoM and thanked Hon'ble Prime Minister of India for free vaccines to all. 14. Hon'ble Member from Chhattisgarh expressed his disagreement with the recommendations made by the GoM and registered his protest at the formulation of the GoM. He stated that the suggestions made by the GoM did not appear to show consistency in the rates that had been suggested for various items and the reasoning that had been given. He referred to the Section 9(1) CGST Act, 2017 which stated that "at such rates not exceeding twenty per cent, as may be notified by the Government on the recomme....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t for supply within India. Thus, zero rating was not brought into the GoM. For 0.1% the ITC on the input goods / services would be high and there would be inverted duty structure and blockage of capital. Then domestic producers would be affected. Rates on crematoriums and ambulances and temperature checking equipment could be further reduced. He thanked the Chairperson for giving compensation to the States which could be used for COVID relief work. He accepted the report of the GoM as pragmatic but suggested that the time period of relief could be extended beyond 31.08.2021. Further, the rate on temperature checking equipment is used by the common man could also be considered for reduction. He thanked the Hon'ble Chairperson for the timely arrangement of State compensation. 17. Hon'ble Member from Arunachal Pradesh thanked the Hon'ble PM for taking the responsibility of supplying the vaccine free of cost to the States for all people above the age of 18 years. He agreed with all the recommendations of the GoM. 18. Hon'ble Member from Uttar Pradesh thanked the Hon'ble PM, the Hon'ble FM and the Union Government for the free vaccination initiative. He stated that the GoM recomme....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ic producers of these medicines would be affected adversely. In these cases, they would not be able to take advantage, of the input tax credit. He urged the Chairperson to take the zero rating or 0.1% route and said that he strongly disagreed with the report. He further stated that the two medicinal items which had been put at Nil rate would adversely affect domestic producers. He also stated that rates certain items like sanitizers masks, PPE kits had not been changed. He stated that he strongly opposed the GOM recommendations for the reasons advanced above. 22. Hon'ble Member from Gujarat appreciated the GoM for submifting their report in very short time window. He stated that if there was anything that the States would like suggest on the subject matter of GoM, the same could be considered However, the GoM repo should be considered positively. The GoM was entrusted with the responsibility of coming to a consensus of GST rate relaxations for COVID related items after analysing the prevailing the rates and taking into consideration the interest of all stake holders. He requested for the acceptance of the GoM report. He thanked the Hon'ble Prime Minister for understanding the Is....
X X X X Extracts X X X X
X X X X Extracts X X X X
....equipment to 0.1%. Further, 75% of vaccines were coming from the central pool and 25% from the private sector. In the private sector, they would transmit the tax burden to the common people, and that zero rating would be helpful there. 26. Hon'ble Member from Haryana stated that he had recommended that the GIC could finalise regarding drugs that were recommended by the Ministry of Health and Family Welfare. He further requested the Council that the tax rate on crematoriums should be further reduced from 12% to 5% as that would help reduce pollution. He also stated the Council should extend the last date for exemption by another two months. 27. Hon'ble Member from Uttar Pradesh stated that the discussions should only be in respect of the GoM and associated issues. He stated that he believed that the tradition of the Council had been to decide issues in consensus and all Members should respect that. 28. Hon'ble Chairperson stated that they had all come together to balance revenue and not to burden the consumer. 29. Hon'ble Member from Kerala clarified the background and intention behind his writing the letter to GoM specifying that he just wanted to place his opinion on r....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n the CGST and SGST Act. In this context he Submitted that currently zero rating is only for interstate supply, that is export and supplies to SEZ, and accordingly, the supplies to which zero rating apply is prescribed only in the IGST Act, however, if zero rating is also to be considered for intra state supply, which does not fall within the ambit of IGST then some Provisions would need to be built into CGST and SOST Acts as well. Hence, for zero rating of Covid-19 relief item, which would be both inter-state and intra state, amendment would be needed in IGST Act, COST Act and all SGST Acts. 32 The Secretary further added that in view of above discussion, it is clear that an amendment or ordinance by the Centre would not suffice and all States would need to amend their respective acts as well. He also clarified that in zero rating, input credit of capital goods would need to be carried forward, and would not be immediately available. He elucidated that if rate was brought down to 0.1%, then not only the credit of capital goods would need to be carried forward, but also the credit for input goods would need to be carried forward, and only credit of the input goods would be avail....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... extended to September and it could be reviewed then if it was needed to be extended further based on the advice of the Ministry of Health Ministry and Family welfare and the situation at that time. The Chairperson stated that it could be explained as to how the functioning of GIC was critical. She stated that if a decision was to be taken on extending the exemption beyond September, the GIC being a body of officials from some States, could take guidance from the political leadership and those who are not a part of the GIC could contact it and state that they would like it to be extended. The GIC, with concurrence of the leadership, could take the call, instead of the GST Council meeting again for one or two agenda items and the GIC could function with the guidance of the Council. The importance of GIC for execution purposes, particularly in a time like this was not to be lost out on. Regarding the FRBM limit, mentioned by the Telangana State, she stated that the Finance Ministry shall take a call on the same and it is not for the council to decide on it. She also clarified that the council had been briefed as to why two items had been nil rated. She proposed that GST rates on gas/....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Member 2. Terms of Reference: The GOM shall examine the need for GST concession/exemption and make recommendations on - (i) COVID vaccines, drugs and medicines for COVID treatment, and testing kits for COVID detection; (ii) Medical grade oxygen, Pulse oximeters, Hand sanitizers, Oxygen therapy equipment such as Concentrators, Generators and Ventilators, PPE kits, N 95 masks, surgical masks, temperature checking equipment; and (iii) any other items required for COVID relief. 3. The GOM on COVID relief shall be assisted by a Committee of officers from the Centre and the States as convened by the GOM. 16 Shipra Shipra MINUTE BOOK 4. CBIC. 5. The secretarial assistance to this GOM shall be provided by Joint Secretary (TRU-I), The GOM shall submit its recommendations to the Council latest by 8 June, 2021. (Dinesh Bouddh) Director (DOR) Tel:011-23092686 To 1. All Members of GoM and Officers 2. Revenue Secretary, North Block, New Delhi 3. Chairperson, CBIC, North Block, New Delhi 4. Member (Tax Policy), North Block, New Delhi 5. Joint Secretary, TRU-I, Department of Revenue, North ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Sikkim Shri Shanti Kumar Dhariwal | Minister for Local Self Government, Urban Shri B.S. Panth 26 Tamil Nadu Dr. Palanivel Thiaga Rajan 27 Telangana Sri T. Harish Rao 28 Tripura Shri Jishnu Dev Varma 29 Uttar Pradesh Shri Suresh Kumar Khanna 30 Uttarakhand Shri Subodh Uniyal 31 West Bengal Dr. Amit Mitra Development & Housing, Law and Legal Affairs Parliamentary Affairs, Minister for Tourism, Civil Aviation, Commerce & Industries Minister for Finance and Human Resource Management Finance Minister Deputy Chief Minister Minister for Finance, Parliamentary Affairs, Medical Education Minister for Agriculture, Agricultural Marketing, Agricultural Processing, Agricultural Education, Garden and Fruit Industries, Silk Development Finance Minister 19 CHAIRMAN'S INITIALS MINUTE BOOK Annexure-II List of officials who have attended 44th GST Council meeting on 12.06.2021 Shipra SI State/Centre Name of the Officer Charge No 1 Govt. of India Shri Tarun Bajaj Revenue Secretary 2 Govt. of India Dr. Krishnamurthy Subramanian Chief Economic ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Tax OSD to Special Chief Secretary, Revenue Commissioner State Tax GST (FAC) 24 21 CHAIRMAN'S INITIALS MINUTE BOOK Shipra 38 Andhra Pradesh Shri J. V. M Sarma 39 Arunachal Pradesh Shri Kanki Darang 40 Arunachal Pradesh Shri Tapas Dutta 41 Assam Shri Manish Thakur 42 Assam Shri Rakesh Agarwala 43 Assam Md. Shakeel Saadullah 44 Bihar Dr. Pratima 45 Bihar Shri Arun Kumar Mishra 46 Chandigarh Shri Mandip Singh Brar 47 Chandigarh Shri Rakesh Kumar Popli 48 Chhattisgarh Shri Gaurav Dwivedi 49 Chhattisgarh Shri Sameer Vishnoi 50 Delhi Shri Sandeep Kumar 51 Delhi Shri Ankur Garg 52 Delhi Shri Anand Kumar Tiwari Joint Commissioner State Tax, GST Commissioner SNO (GST) Commissioner &Sercretary, Finance Principal Commissioner of State Tax Additional Commissioner of State Tax Commissioner cum Secretary Commercial Taxes Special Secretary, Commercial Taxes Excise & Taxation Commissioner Additional Excise & Taxation Commissioner, Principal Secretary, Commercial Tax Commiss....
X X X X Extracts X X X X
X X X X Extracts X X X X
....in Gadre 82 Maharashtra Shri Rajiv Mittal 83 Maharashtra Ms. VishakhaBorse 84 Maharashtra Shri Kiran Shinde 85 Manipur Shri Yumnam Indrakumar Singh 86 Meghalaya Smt S. A. Synrem 87 Meghalaya Shri ArunkumarKhembavi Commissioner, Commercial Taxes Joint Commissioner, Commercial Taxes Additional Chief Secretary, Finance Principal Secretary (Financial Reforms) Commissioner of State Tax Joint Commissioner of State Tax Deputy Commissioner of State Tax Assistant Commissioner of Taxes Commissioner & Secretary, Excise, Registration, Taxation & Stamps Commissioner, SGST 88 Meghalaya Shri L. Khongsit Additional Commissioner, SGST 89 Mizoram Shri VanlalChhuanga 90 Mizoram Shri KailianaRalte 91 Nagaland Shri Y Mhathung Murry 92 22 Nagaland Shri Wochamoodyuo 93 Odisha Shri Ashok K. K. Meena Rs CHAIRMAN'S INITIALS 94 Odisha Shri Sushil Kumar Lohani 95 Puducherry Shri Shurbir Singh 96 Puducherry Shri L. Kumar 24 24 Commissioner & Secretary, Taxation Department Commissioner of State Tax Spe....
X X X X Extracts X X X X
X X X X Extracts X X X X
....er, State Tax Additional Commissioner, State 125 Uttarakhand Shri Amit Gupta Tax 126 Uttarakhand Dr Sunita Pandey 127 Uttarakhand Shri Pramod Joshi 128 Uttarakhand Shri S.S. Tiruwa 129 Uttar Pradesh Shri Sanjiv Mittal 130 Uttar Pradesh Ms Ministhy S 131 Uttar Pradesh Shri Vivek Singh 132 Uttar Pradesh Shri Manoj Tiwari 133 West Bengal Shri Manoj Pant 134 West Bengal Ms Smaraki Mahapatra CHAIRMAN'S 135 West Bengal Shri Khalid Aizaz Anwar INITIALS 26 Joint Comm/Nodal Officer, State Tax Joint Commissioner, State Tax Deputy Commissioner, State Tax Additional Chief Secretary, State Tax Commissioner, Commercial Tax Joint Commissioner (GST),Commercial Tax HQ Joint Commissioner (Statistics), Commercial Tax HQ Principal Secretary, Finance Department Secretary, Finance Department Commissioner, Commercial Taxes Shipra MINUTE BOOK 136 West Bengal Shri Rajib S. Sengupta Senior Joint Commissioner, Commercial Taxes 27 27 CHAIRMAN'S INITIALS Ny CHAIRMAN'S INITIALS MINUTE BOOK Annexure-III Re....