Amid a massive uproar over high vaccine prices, the government is likely to waive Goods and Services Tax (GST) on coronavirus vaccines, reported Hindustan Times.
People in the know told Hindustan Times that the government may waive the 5 percent GST applicable on COVID-19 vaccines to reduce their cost by up to Rs 1,200 a dose in private hospitals depending on the vaccine.
"The Centre has already waived import duty on most essential pharmaceutical raw materials required to manufacture drugs for the treatment of COVID-19 patients, and is considering scrapping the 5 percent GST on vaccines on similar grounds," sources told Hindustan Times.
One person told the leading daily that the waiver will require the approval of the GST Council, but it is unlikely that any member will oppose the move. "It will not have significant revenue implication,” the person added.
The government announced the liberalised and accelerated Phase 3 strategy of COVID-19 vaccination that permits manufacturers to release up to 50 per cent of their stock to state governments and private entities.
Under the third phase of the national vaccination drive commencing next month, the vaccine manufacturers would supply 50 per cent of their monthly Central Drugs Laboratory (CDL) released doses to the central government and would be free to supply the remaining 50 per cent doses to state governments and in the open market, the government had said.
Meanwhile, Serum Institute of India (SII) — the maker of the most used COVID-19 vaccine in the country, Covishield — on Wednesday announced a price cut. It plans to sell the jab for Rs 300 per to the states — previously the price was Rs 400.
SII's CEO Adar Poonawalla took to Twitter to announce the "philanthropic" gesture. "As a philanthropic gesture on behalf of @SerumInstIndia, I hereby reduce the price to the states from Rs 400 to Rs 300 per dose, effective immediately; this will save thousands of crores of state funds going forward. This will enable more vaccinations and save countless lives," he said.
Last week, SII had defended the pricing of the Covishield vaccine, saying the earlier price was based on advance funding and now it has to invest in scaling up and expanding capacity to produce more shots.
The company, which manufactures the Oxford-AstraZeneca vaccine at Pune, had on April 21 announced a price of Rs 600 per dose for private hospitals and at Rs 400 for state governments and for any new contract by the central government.
"The current situation is extremely dire, the virus is constantly mutating while the public remains at risk. Identifying the uncertainty, we have to ensure sustainability as we must be able to invest in scaling up and expanding our capacity to fight the pandemic and save lives," the company had earlier said.
The government last week waived basic customs duty on import of COVID vaccines, medical-grade oxygen and related equipment for three months. India has announced an expansion of its COVID-19 vaccination drive by allowing its large 18-plus population to get inoculated from May 1.