Exclusive! GST Council likely to consider 18 pct rate on all kind of sanitizers in September 19 meet

GST Council in its meeting on September 19 will likely decide on 18 pct rate on all kind of sanitizers, sources told Zee Business exclusively. Currently, while non-alcohol based sanitizer attracts 12 pct, 18 pct tax is levied on alcohol-based sanitizer. As per sources, ayurvedic companies are against rate change on their sanitizers and want it to remain same.

The GST Council-nominated fitment committee will meet September 14 to assess the proposed tax structure on sanitizers but the final call will be taken by the GST Council. The government had issued a clarification on July 15 that all kinds of sanitizers should be taxed at the same rate. Last month, the Delhi High Court had also dismissed the PIL for including masks and sanitizers in essential commodities saying it's a policy decision and there wasn't enough evidence to prove that these products are not easily available to common people.

Besides rate decision on sanitizers, the GST Council will also decide on contentious issue of GST compensation for states. Some states are not willing to borrow for the compensation shortfall under two options given by the GST Council in its last meeting.

The council had proposed two options to states, under first option, they can borrow Rs 97,000 crore  through a special window, while under the second option, they can borrow the entire revenue shortfall of Rs 2,35,000 crore from open market. The decision on state compensation may be taken by voting as there is no clarification from the Centre yet with regard to new method, as per sources.

See Zee Business Live TV Streaming Below:

Some minor changes may also be done in the GST law relating to Tran 1 in the upcoming GST Council meet, the sources added.