Business News: Merger of GST blocks may take longer.
A plan to combine the 12% and 18% Goods and Services Tax (GST) plates into a single rate that will apply to most goods is expected to be delayed, while GST compensation applied to items how the cars could be extended, three officials aware of talks between central and state governments said.
Friday’s GST Council meeting is expected to discuss a number of state-reported issues related to medical supplies tax rates, as well as the GST compensation mechanism for AF22.
Items that could be affected include processed foods, medical-grade oxygen, and medical-grade equipment, he added. The issue is expected to be among the priority discussions at the GST Council meeting on May 28, in the context of the ongoing COVID-19 situation in India.
There are also expectations that the GST Council will set rates for COVID-19 vaccines at the meeting. One of the sources said the meeting’s agenda will be ready by May 25 and this meeting is likely to be a long affair, he added.
West Bengal, Punjab and Odisha discussed the GST exemption on vaccines, but Finance Minister Nirmala Sitharaman explained that a full exemption would lead vaccine manufacturers to pass on input costs to final consumers through an increase in the retail price.
Meanwhile, other priority topics at the meeting would include discussion of the GST compensation mechanism for FY22 – specifically whether the loan scheme established last year to meet the states’ GST compensation is to be continued, the Ministry of Finance did not respond. to questions, the report adds.