Govt waives IGST on import of COVID-relief material received as donation for free distribution

In view of the COVID-19 pandemic, the Central Government has issued notifications exempting Basic Customs Duty or Health cess on imports of a number of COVID-19 related relief materials, for a limited period.

New Delhi:The government on Monday waived Integrated GST (IGST) till June 30 on the import of COVID-related relief material donated or received free of cost from outside India for free distribution.

The Finance Ministry in a statement said the government had received a number of representations from charitable organisations, corporate entities, and other Associations/ entities outside India seeking exemption from IGST on the import of Covid-19 relief material, donated/received free of cost from outside India for free distribution.

GOI's letter

'Accordingly, the Central Government has ... granted exemption from IGST on import of such goods received free of cost for free distribution for covid relief,' it said, adding the exemption would be applicable till June 30.

This exemption would also cover goods already imported but lying uncleared at the Customs ports.

The Government has already exempted from customs duty import of a host of COVID-related relief materials, including Remdesivir injection and its APIs, Inflammatory diagnostic (markers) kits, medical-grade oxygen, oxygen therapy-related equipment such as oxygen concentrators, cryogenic transport tanks, etc, and Covid vaccines.

The IGST exemption given on Monday would be subject to nodal authorities, appointed by the state governments, authorising any entity, relief agency or statutory body, for free distribution of such relief material.

The said goods can be imported free of cost by a state government or, any entity/ relief agency/ statutory body, authorized in this regard for free distribution anywhere in India.

The importer shall before clearance of goods from Customs produce a certificate from the said nodal authorities that goods are meant for free distribution for Covid relief.

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After imports, the importer shall produce, to the Deputy or Assistant Commissioner of Customs at the port within a period of six months from the date of importation or within such extended period not exceeding nine months, a statement containing details of goods imported and distributed free of cost.

This statement shall be certified by the said nodal authority of the state government.

'This exemption shall thus enable import of the Covid relief supply imported free of cost for free distribution without payment of IGST (up to the 30th June, 2021). As customs duty is already exempt, these imports will not attract any customs duty or IGST,' the ministry added.

India's single day COVID infections had crossed a record 4 lakh mark last week. On Monday, 3.68 lakh new infections and 3,417 deaths were reported.

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Last week, the government slashed IGST rate on import of oxygen concentrators for personal use to 12 per cent, from 28 per cent, for two months till June 30.

Under Goods and Services Tax (GST), the tax levied on consumption of goods or rendering of service is split 50:50 between the Centre and the state. Such tax is known as Central-GST or CGST and State-GST or SGST.

On inter-state movement of goods as well as imports, an Integrated-GST or IGST is levied, which accrues to the Centre. The amount paid as IGST can be utilised by businesses for claiming credit while making CGST or SGST payments at the time of actual sale.

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AMRG & Associates Senior Partner Rajat Mohan said, 'Government has rightly come up with full IGST relief on import of covid related relief material including oxygen concentrators, generators, cylinders and covid medicines by state government and its authorised agencies.'

PTI