Central Government decides to waive GST on COVID-19 Vaccine
According to people familiar with the matter, the government may waive the Goods and Services Tax (GST) on Covid-19 vaccines to reduce their costup to $1200 per dose in private hospitals beginning May 1 depending on the vaccineto ease the burden on people and promote vaccination.
The waiver will require approval of the GST Council. But, it is unlikely that any member will oppose the move that will provide relief to people in all states. Besides, it will not have significant revenue implications, said a person.
On similar grounds, the government has already waived import duties on most important pharmaceutical raw materials used to produce drugs to treat coronavirus disease and is considering scrapping the 5% GST on Covid-19 vaccines, according to the people, who spoke on the condition of anonymity.
The Union government announced on April 19 that, beginning May 1, a liberalised and accelerated phase-3 strategy for Covid-19 vaccination would enable vaccine manufacturers to release up to 50% of their supplies to state governments and the open market at a pre-determined price.
On April 28, SII reduced the rate of Covishield for state procurement. As a philanthropic gesture on behalf of @SerumInstIndia, I hereby reduce the price to the states from ?400 to ?300 per dose, effective immediately; this will save thousands of crores of state funds. This will enable more vaccinations and save countless lives, SII CEO Adar Poonawalla tweeted.
Bharat Biotech did not respond to an email question, while an external spokesperson for SII declined to comment. The vaccine expense for the Union government's vaccination campaign was slightly lowerfree in government hospitals and $250 in private hospitals.
A waiver of GST, if granted, will reduce costs for governments, as well as incentivise more private players to purchase and distribute vaccines. This move will boost immunizations and provide some respite from the current crisis, said the founder and CEO of the financial technology company Cleartax, Archit Gupta.