FM Nirmala Sitharaman responds to Mamata Banerjee over letter to PM Modi for GST exemption

Following West Bengal CM Mamata Banerjee's letter to PM Modi seeking GST & customs' exemption on COVID drugs & Oxygen, Finance Minister Nirmala Sitharaman pointed out that the IGST exemption for a list of items related to COVID relief had already been granted on May 3 and that exemption of customs duty or health cess had been approved even earlier. Responding to Mamata Banerjee's letter to PM Modi in a series of 16 tweets, the Union Finance Minister pointed out that the full exemption from Customs duties, including IGST, was already available to all COVID relief material imported by the Indian Red Cross for free distribution in the country. Further, Nirmala Sitharaman noted that full exemption from all duties had been provided to Remdesivir injections, Remdesivir API, and for a chemical for the manufacture of this drug.

Nirmala Sitharaman went on to point out that the exemption had been extended for Medical Oxygen, equipment used for the manufacture, storage and transportation of oxygen, equipment used for providing oxygen therapy to COVID patients such as Oxygen Concentrators, Ventilators, Non-invasive oxygen masks etc, inflammatory diagnostic kits and reagents for COVID testing and COVID vaccines and that the exemption applies to all above-mentioned goods when imported free of cost for free distribution in the country by any entity, State Govt, relief agency or autonomous body on the basis of a certificate issued by a State Government. Moreover, the Union Finance Minister added that the government had also provided full exemption from basic customs duty and health cess to their commercial imports. to augment the availability of such times. 

Responding to West Bengal CM Mamata Banerjee on the exemption of GST on COVID vaccines, Nirmala Sitharaman pointed out that the domestic producers of these items would be unable to offset taxes paid on their inputs and input services if the full exemption was granted and would pass these on to the end consumers by increasing their price. She added that the Centre was providing free vaccines to those above 45 years of age and for frontline workers and that the GST was also paid by the government on supplies made by them. 

Mamata writes to PM Modi

West Bengal Chief Minister Mamata Banerjee on Sunday wrote a letter to Prime Minister Narendra Modi requesting him to exempt Goods and Services Tax (GST), customs duty, taxes from oxygen concentrators, cylinders, and COVID drugs. Banerjee also urged PM Modi to strengthen health infrastructure and augment supplies of equipment, medicines and medical oxygen for treatment of COVID- positive patients. CM Banerjee also mentioned in the letter that many of the donors who have approached the State government have requested to consider exemption of these from customs duty, SGST, CGST, IGST. She further said, 

“A large number of organizations, individuals, and benevolent agencies have come forward to donate oxygen concentrators, cylinders, cryogenic storage tanks, tankers and tank containers, and COVID-related drugs. Donations from these organisations will greatly supplement the efforts of the State government in meeting the huge gap in demand and supply,” Banerjee wrote in the letter.

"As the rate structure falls under the purview of the Central government, I would request that these items may be exempted from GST/customs duty and other such duties and taxes to help remove supply constraints of the above-mentioned life-saving drugs and equipment and contribute towards effective management of the COVID pandemic."