Centre to Share 70% GST Income from Vaccine with States, Says FM
Centre to Share 70% GST Income from Vaccine with States, Says FM
The Centre will buy the 75% vaccine as announced and will pay its GST too, said FM Sitharaman GST on Covid vaccine: The Centre will buy the 75% vaccine as announced, said finance minister Nirmala Sitharaman Last Updated:June 12, 2021, 16:16 IST FOLLOW US ON: To provide some relief to common man amid the second
The Centre will buy the 75% vaccine as announced and will pay its GST too, said FM Sitharaman
GST on Covid vaccine: The Centre will buy the 75% vaccine as announced, said finance minister Nirmala Sitharaman
Last Updated:June 12, 2021, 16:16 IST
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Explaining the rationale behind this, Sitharaman said, “5% GST on vaccines will stay. The Centre will buy the 75% vaccine as announced and will pay its GST too. But 70% of income from GST will be shared with the states.”
Last week, Prime Minister Narendra Modi announced that the Union government will provide the free coronavirus vaccine to states for inoculation of all above the age of 18 from June 21. The Centre has decided to buy 75 per cent of jabs from vaccine makers, including 25 per cent of the state quota, and give it for free to state governments. He also asserted that Covid vaccine supply would be increased significantly in the country in coming days.
“The GST council’s decision to not cut GST rate on vaccines is a positive one considering that it will not disturb the principal of fungibility of credit under GST and thereby not lead to cost increase arising from loss of credits. Steps such as zero rating with credits or full abatement with credit etc. could have also lead to an aberration under the GST laws. At the same time the Government has ensured that people are not burdened with the vaccine /GST cost by picking up the same, except where it may not matter viz. purchases by private parties,” said Ritesh Kanodia, Partner, Dhruva Advisors LLP.
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