With the third wave of Covid around the corner, the Union government on Tuesday exempted basic customs duty on imports of specified API (active pharma ingredient)/excipients for Amphotericin B till August 31 and raw materials for manufacturing Covid test kits till September 30.
APIs for anti-fungus drug Amphotericin B attract 10-15% basic customs duty while the rates vary for raw materials for testing kits.
“This (customs duty removal) is a well thought exemption being granted by the Indian government to fight the Covid crisis and is a step to make the domestic industry self-reliant while fighting the pandemic,” said Abhishek Jain, Tax Partner, EY.
Among other Covid-related relief measures announced on June 12, the Goods and Service Tax (GST) Council had exempted Amphotericin B from 5% GST and slashed the GST rate to 5% from 12% on Covid testing kits.
The latest move will help bring relief to common man by way of more affordable medicines/medical gear amid threat of third wave of Covid-19 pandemic. After Covid-19 broke out last year, India has seen a steady rise in fungal infections also.
On June 12, the GST Council slashed rates for Covid drugs, testing kits, medical equipment and even ambulances to provide relief to people amid the pandemic, but kept the tax on vaccines unchanged at the lowest slab of 5%. The new rates will remain effective till September 30, 2021.
While some state finance ministers, including West Bengal’s Amit Mitra and Punjab’s Manpreet Singh Badal pitched for a temporary waiver of tax for all Covid drugs, vaccines and equipment, a group of ministers led by Meghalaya chief minister Conrad Sangma recommended slashing of GST rates for items other than vaccines.