GST Rate for Medicines
GST Rate for Medicines
The GST Council in the meeting held on 3rd June 2017 ruled the GST rates for medicines in India. As per the council’s decision, GST is levied under five different rates, namely NIL, 5%, 12%, 18% and 28% based on the HSN code of the item. Medicines and pharmaceuticals are classified under the 37th chapter of the HSN Code. In this article, we look at the GST rate for medicines and the associated HSN code.
NIL GST Rate Medicines
The following types of medicines and pharmaceutical products are exempt from GST:
- Human Blood and its components
- All types of contraceptives
5% GST Rate
Goods under the following HSN categories are taxed at 5% GST rate:
- Animal or Human Blood Vaccines
- Diagnostic kits for the detection of all types of hepatitis
- Desferrioxamine injection or deferiprone
- Medicaments (including veterinary medicaments) used in bio-chemic systems and not bearing a brand name
- Oral rehydration salts
- Drugs or medicines including their salts and esters and diagnostic test kits
- Formulations manufactured from the bulk drugs
12% GST Rate
The following types of medicines and pharmaceutical products are taxed at 12% GST rate:
- Organs for organo-therapeutic uses, dried, whether or not powdered; extracts of glands or other organs or of their secretions for organo-therapeutic uses; heparin and its salts; other human or animal substances prepared for therapeutic or prophylactic uses, not elsewhere specified or included
- Animal blood prepared for therapeutic, prophylactic or diagnostic uses; antisera and other blood fractions and modified immunological products, whether or not obtained by means of biotechnological processes; toxins, cultures of microorganisms (excluding yeasts) and similar products.
- Medicaments consisting of two or more constituents which have been mixed together for therapeutic or prophylactic uses, not put up in measured doses or in forms or packings for retail sale, including Ayurvedic, Unani, Siddha, homoeopathic or Bio-chemic systems medicaments.
- Medicaments consisting of mixed or unmixed products for therapeutic or prophylactic uses put up in measured doses (including those in the form of transdermal administration systems) or in forms or packings for retail sale, including Ayurvedic, Unani, homoeopathic Siddha or Biochemic systems medicaments, put up for retail sale.
- Wadding, gauze, bandages and similar articles (for example, dressings, adhesive plasters, poultices), impregnated or coated with pharmaceutical substances or put up in forms or packings for retail sale for medical, surgical, dental or veterinary purposes.
- Pharmaceutical goods such as Sterile surgical catgut, similar sterile suture materials (including sterile absorbable surgical or dental yarns) and sterile tissue adhesives for surgical wound closure; sterile laminaria and sterile laminaria tents; sterile absorbable surgical or dental haemostatics; sterile surgical or dental adhesion barriers, whether or not absorbable, etc.,
- Waste pharmaceuticals
18% GST Rate
Nicotine polacrilex gum is the only medicine or pharmaceutical product taxed at 18% GST rate. No pharmaceutical or medicines have been taxed at 28% GST. Hence, the highest applicable GST rate for medicines is 18%.