Dismayed over non-acceptance of his ‘zero, or maximum 0.1 per cent Goods and Services Tax (GST)’ request on medical supplies required to fight Covid-19 spread, West Bengal Finance Minister Amit Mitra expressed concern over ‘ubiquitous’, ‘omnipotent’, ‘authoritarian’ and ‘majoritarian’ approach of the GST Council.
Addressing a virtual press conference on Monday, he said, “It is unfortunate that the consensus-driven GST Council is now showing ubiquitous, omnipotent, authoritarian and majoritarian approach. Such an approach not only destroys the federal institution but also turns down zero GST on medical supplies required to contain Covid-19 spread is an anti-people move.”
Mitra’s reaction came after his suggestion to keep Covid-19 medicines and medical items out of GST purview required to fight Covid-19, or a maximum 0.1 per cent GST (if at all required to be imposed) was turned down in the 44th GST Council meeting, chaired by Union Finance Minister Nirmala Sitharaman and comprising State ministers on June 12.
However, the Council after the meeting slashed the tax rate on Covid-19 drugs such as remdesivir and tocilizumab as well as on medical oxygen and oxygen concentrators.
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It was learnt that Mitra’s suggestion for complete tax relief is also supported by some of the leaders of other opposition ruled states like Kerala and Punjab. However, the GST Council decided to keep most of the items at a 5 per cent rate (GST) until September 30.
The GST on ambulances has been reduced from 28 per cent to 12 per cent. In the case of electric furnaces used in crematoriums, it is now reduced to 5 per cent from 18 per cent. The GST on thermal guns or body temperature checking equipment reduced to 5 per cent from 12 per cent.
Mitra also said, “West Bengal is supposed to get an additional GST compensation of Rs 4,911 crore. I have written to the Finance Minister but there is no response till now.”
Elaborating more on the mistrust factor (in GST council), Mitra had earlier told News18 that ‘Right from the empowered committee meeting held in Kolkata where finance ministers of all the States were present. Mr Arun Jaitley (then Finance Minister) also came to Kolkata to see whether a consensus can be reached on the GST.
It was from there the trail began. Mr Jaitley came down from his hotel room and I told him that the draft (on GST prepared by the union finance ministry) should include ‘Parliament Shall’ instead of the word ‘may’ (in compensation clauses to the States). The States gave up 70% of their taxing power when GST was introduced, with the guarantee that they will be compensated at a 14% annual increase by the central government for five years. Surprisingly, the same consensus is not being followed by the same finance ministry.”
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