GST on COVID Vaccine
The second wave of COVID has adversely impacted the lives of people and also dented the economy of India. So, to control the spike in COVID cases in India, the government has decided to vaccinate everyone who is above 18 years of age. However, the question arises whether the approved COVID vaccines attract GST. So, in this blog, we will discuss the applicability of GST on the COVID-19 Vaccine.
Types of COVID Vaccines Available In India
There are three types of COVID vaccines that have been approved by the Government of India for the vaccination drive. These includes:
- COVISHIELD produced by Serum Institute of India Ltd.
- COVAXIN produced by Bharat Biotech International Ltd.
- Sputnik V produced by Gamaleya Research Institute of Epidemiology and Microbiology
The first jab of COVID vaccines was given to healthcare and frontline workers. Now, keeping the recent scenario in mind, the government has given a green flag to vaccinate all those citizens who are above 18 years of age.
Taxability of COVID Vaccine under GST
Vaccines are lifesaving medications that are treated as goods under GST. So, the COVID-19 vaccine will likewise be dealt with like goods. As per Section 7 of the CGST Act, 2017, any goods or/and services that are made in the course of business will draw in GST. The place of supply will be where the vaccines are distributed. Currently, vaccines are distributed by only the Central and State governments. The value of supply for vaccines under GST will be the exchange value. The expense will incorporate research and development costs, raw materials cost, labor cost, and so on. Vaccines do not go under exempted pharmaceutical goods; thus, GST is applicable.
GST on COVID Vaccine
The COVID-19 vaccine goes under the section ‘Drugs and Pharmaceuticals’. Under this section, vaccination for humans or animals is charged at 5%. The HSN Code for the same is 3002/3006. That implies, 5% GST applies to the COVID vaccine.
For instance, If the value of the vaccine is INR 500, the GST applicable on the COVID vaccine will be INR 25 (500×5%). This will further help the vaccine producer to claim ITC for the GST paid on the goods or/and services utilized to create or supply such vaccine.
