GST Council Meeting held on 28 May via Video Conference

Finance Minister Nirmala Sitharaman Chairs GST Council Meeting via Video Conference

· Three issues are likely to Dominate the Discussions - Extension of the GST Compensation, Tax-Free Status for COVID Relief, and Inverted Duty Structure

· CAIT seeks Extension of GST Return Filings Deadline

· Remove GST on Life-Saving Medicines, Equipment used in COVID-19 Fight: Priyanka to Government

After a gap of seven months, the GST Council meeting will be held on May 28, Finance Minister Nirmala Sitharaman's office said on May 15. This comes as a number of states have sought GST rate cuts on essential Covid supplies, and have been seeking a Council meeting to discuss the matter. The finance minister will chair the 43rd GST Council meeting via video conferencing at 11 AM in New Delhi on 28th May 2021. The meeting will be attended by Minister of State Anurag Thakur besides Finance Ministers of States & Union Territories and senior officers from Union Government & States, her office tweeted from its official account. Three issues are likely to dominate the discussions: One, an extension of the GST compensation regime beyond 2022; Two, tax-free status for goods and services related to COVID relief; and Three, correcting inverted duty structure and bringing petroleum goods under the GST ambit.

Notably, the GST Council meeting comes at a time when many states are forcefully demanding that taxes should be removed or reduced for oxygen cylinders, ventilators, concentrators, and life-saving drugs like Remdesivir, which many COVID-19 patients need. This month, Finance Minister Nirmala Sitharaman, who will chair the council meeting, had spelt out the Centre’s stand on cutting rates on various GST supplies. Sitharaman, in her response to a letter from West Bengal Chief Minister Mamata Banerjee, said that exempting domestically produced and commercially imported items from GST would make manufacturers unable to avail input tax credit, which in turn could lead to higher prices for customers. The Centre has already exempted integrated GST on a number of imported items such as concentrators, medical-grade oxygen, ventilators, and life-saving drugs which come in through the donation route.

Meanwhile, the shortfall in GST compensation payable to states in the current fiscal is estimated at Rs 2.69 lakh crore, of which Rs 1.58 lakh crore would have to be borrowed this year. The Centre expects to collect over Rs 1.11 lakh crore through cess on luxury, demerit and sin goods which will be given to the states to compensate them for the shortfall in revenue arising out of GST implementation. The remaining Rs 1.58 lakh crore would have to be borrowed to meet the promised compensation to states under the Goods and Services Tax (GST) regime. Under GST law, states were guaranteed to be compensated bi-monthly for any loss of revenue in the first five years of the GST implementation from July 1, 2017.

CAIT seeks Extension of GST Return Filings Deadline

Traders' body Confederation of All India Traders (CAIT) on has sought extension of the deadline for filing various GST returns till August as well as cut in tax rates for medical and surgical equipment required for treating coronavirus and black fungus infections. The body wrote to Finance Minister Nirmala Sitharaman urging her to extend the date of filing of various GSTR returns till August under the GST Act and Rules, without late fee and interest.

It said that GST officers should not resort to cancellation of registrations at this time unless there are pressing reasons for doing so. Also, for all traders having turnover of below Rs 20 crore in a year, no survey or audits or special assessments should be ordered for the years 2017-18 and 2018-19, it added.

It has also demanded that the rate of GST on all the medical and surgical equipment required for treatment of Covid and black fungus infections should be reduced considerably. And sought a financial package for the traders and a moratorium of six months on loans taken from banks and other financial institutions. (PTI)

Remove GST on Life-Saving Medicines, Equipment used in COVID-19 Fight: Priyanka to Government

Congress leader Priyanka Gandhi Vadra on Friday urged the Centre to remove GST on all life-saving medicines and equipment being used in the fight against COVID-19, asserting that charging tax on such items amid the pandemic amounts to "cruelty". Her appeal to the government came ahead of the GST Council meeting, which decides on taxes on goods and services, later on Friday.

Recovering GST on COVID-related products from people who struggled for ambulances, beds, ventilators, oxygen, medicines, vaccines during the pandemic amounts to "cruelty and insensitivity", Priyanka Gandhi said in a tweet. "Today, in the GST Council, the government should remove GST on all life-saving medicines and equipment being used in the fight against COVID," the Congress general secretary said.

She also attached a list of items being commonly used in the fight against coronavirus and the rate of GST charged on them. (PTI)