{"id":13280,"date":"2020-07-21T14:11:30","date_gmt":"2020-07-21T08:41:30","guid":{"rendered":"https:\/\/corpbiz.io\/learning\/?p=13280"},"modified":"2020-07-21T14:36:15","modified_gmt":"2020-07-21T09:06:15","slug":"gst-rates-for-hand-wash-and-sanitizers","status":"publish","type":"post","link":"https:\/\/corpbiz.io\/learning\/gst-rates-for-hand-wash-and-sanitizers\/","title":{"rendered":"GST Rates for Hand Wash and Sanitizers"},"content":{"rendered":"\n<p class=\"has-drop-cap\"> Finance Ministry clarified that hand sanitizers would attract a standard duty rate of 18% under the GST regime as they come in the category of disinfectants like anti-bacterial liquids, soaps, Dettol, etc. According to Finance Minister, reduction in GST rate would help neither manufacturers nor consumers after receiving comments on the GST rates for essential items like Hand wash and sanitizers &#8211; following the Goa bench AAR ruling. <\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title ez-toc-toggle\" style=\"cursor:pointer\">Page Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/corpbiz.io\/learning\/gst-rates-for-hand-wash-and-sanitizers\/#GST_Authority_of_Advance_Ruling_%E2%80%93_Goa_bench\" >GST Authority of Advance Ruling &#8211; Goa bench<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/corpbiz.io\/learning\/gst-rates-for-hand-wash-and-sanitizers\/#Latest_GST_Rates_for_Mask_Sanitizer_Hand_Wash\" >Latest: GST Rates for Mask, Sanitizer &amp; Hand Wash<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/corpbiz.io\/learning\/gst-rates-for-hand-wash-and-sanitizers\/#Synopsis_of_Arguments_on_raise_of_GST_Rates_for_Hand_Sanitizers\" >Synopsis of Arguments on raise of GST Rates for Hand Sanitizers<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/corpbiz.io\/learning\/gst-rates-for-hand-wash-and-sanitizers\/#Conclusion\" >Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"GST_Authority_of_Advance_Ruling_%E2%80%93_Goa_bench\"><\/span>GST Authority of Advance Ruling &#8211; Goa bench <span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>While maintaining the classification as an essential commodity cannot be a criterion for exemption from GST, the alcohol-based hygiene product will attract 18 percent GST. It was held by the Goa bench of the GST Authority of Advance Ruling (AAR).<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Observation of the Case<\/h3>\n\n\n\n<p>On the request &amp; over-classification of the hand sanitizer,\nand the applicable rate of GST, the &#8220;Spring-fields (India)\nDistilleries&#8221; had moved Goa Bench Authority of Advance Ruling. As the\nMinistry of Consumer Affairs has classified hand sanitizers as an essential\ncommodity, they have sought a judgment on &#8220;whether it will be exempt from\nGST, or not.&#8221;<\/p>\n\n\n\n<p>&#8220;The various packing materials chemicals, and input services, etc. also attract a GST rate of 18%. Those are also used for the manufacture of hand sanitizers. The Government has also clarified that falling down the GST rate on sanitizers and other similar matters would lead to an inverted duty format and place the domestic manufacturers at difficulties as well as the importers of hand sanitizers too&#8221;. If domestic manufacturing suffers on account of an inverted duty structure, consumers would also eventually not benefit from the lower GST rate, the Government clarified.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Latest_GST_Rates_for_Mask_Sanitizer_Hand_Wash\"><\/span>Latest: GST Rates for Mask, Sanitizer &amp; Hand Wash<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img decoding=\"async\" width=\"668\" height=\"621\" src=\"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2020\/07\/image-98.png\" alt=\"GST Rates for Mask and Sanitizer\" class=\"wp-image-13281\" srcset=\"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2020\/07\/image-98.png 668w, https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2020\/07\/image-98-300x279.png 300w\" sizes=\"(max-width: 668px) 100vw, 668px\" \/><\/figure><\/div>\n\n\n\n<h3 class=\"wp-block-heading\">CBIC Observation of Hand Sanitizers<\/h3>\n\n\n\n<p>The CBIC (Central Board of Indirect Taxes and Customs) has\nissued a clarification on GST (Goods and Services Tax) on &#8220;Hand\nSanitizers.&#8221; The issue has been reported in a few media sections of the\nGST rate on alcohol-based hand sanitizers.<\/p>\n\n\n\n<p>The GST Council decides the GST rates on various items. However, all the state governments and the Central Government together deliberate and take conclusions. It is further clarified that inputs for hand sanitizers&#8217; manufacture attract a GST rate of 18%, which chemicals include packing material &amp; input services.&nbsp; Moreover, it has been clarified that &#8211; Lower GST rates help imports by making them cheaper. Again, this is against the nation&#8217;s policy on &#8220;Atma Nirbhar Bharat.&#8221; If domestic manufacturing suffers on account of an inverted duty structure, consumers would sooner or later not benefit from the lower GST rate. <\/p>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/revocation-of-cancellation-of-gst-registration-online\/\">Guide on Revocation of Cancellation of GST Registration\n<\/a><\/mark><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Synopsis_of_Arguments_on_raise_of_GST_Rates_for_Hand_Sanitizers\"><\/span>Synopsis of Arguments on raise of GST Rates for Hand Sanitizers<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>There are many arguments and questions raised after the raise in GST Rates for hand sanitizers. Few are stated below:-<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Arguments of Manufacturers<\/h3>\n\n\n\n<p>Earlier, hand sanitizers were classified as medicinal preparation under <strong>&#8220;Medicinal and Toilet preparations (Excise Duties) Act, 1955<\/strong><sup><a href=\"https:\/\/rajexcise.gov.in\/Downloads\/RSED\/PDF\/Medicinal%20and%20Toilet%20Preparations%20Act%201955.pdf\"><strong>[1]<\/strong><\/a><\/sup>&#8221; according to the manufacturers, and excise duty was paid on it, therefore. These companies had been paying 12 percent GST, after the imposition of GST in 2017 as per the Medicaments category.<\/p>\n\n\n\n<p>Unexpectedly, now they have to pay 18 percent GST as the GST department is telling us that Hand Sanitizers fall under the &#8216;disinfectant category.&#8217; The manufacturers have been sending notices to companies condemning them of evading tax&#8221;&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Arguments of Different Committees<\/h3>\n\n\n\n<p>The GST department has started labeling them as tax evaders and\nis continually hitting notices instead of declaring sanitizer manufacturers as\nCorona warriors. In has been quoted by the Confederation of Indian Industry &#8211;\nHimachal&#8217;s Harish Aggarwal, Laghu Udyog Bharti Pharma Committee national\npresident Rajesh Gupta and BBN Association chairman Sanjay Khurana; in their\nstatements.<\/p>\n\n\n\n<p>They also inserted a statement that there is no tax evasion\nissue as they charge 12 percent GST from customers and deposit the same with\nthe government. They have questioned why the department did not raise\nobjections when the companies have been filing a return at 12 percent GST since\nJune 30, 2017, if they feel that these industries are committing folly by not\npaying 18 percent GST?<\/p>\n\n\n\n<p>Moreover, the insecticides, anti-sprouting products, rodenticides,\nherbicides, fungicides, plant growth regulators are included in the category of\n&#8220;disinfectant,&#8221; which all are related to the products used for\nagriculture and horticulture. Therefore, the GST Department&#8217;s decision to\nclassify hand sanitizers as &#8220;disinfectant&#8221; is irrational, highly\nambiguous, and irrational. Unlike disinfectants used on the dead surfaces like\nsoil or the plants, the alcohol-based hand sanitizers are destined to be used\non the human body.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The more significant test may necessarily be around applicability on the institutions having <a href=\"https:\/\/corpbiz.io\/gst-registration\"><strong>GST registration<\/strong><\/a>. After due trial and discussion, the court held that &#8220;Sanitizers are disinfectants like anti-bacterial liquids, soaps, Dettol, etc., which all entice standard duty rate of 18% under the GST regime&#8221;.&nbsp;<\/p>\n\n\n\n<p>Our <a href=\"https:\/\/corpbiz.io\/\"><strong>CorpBiz<\/strong><\/a> legal group will be at your disposal if you want expert advice on any aspect of GST implications, registration or compliance, and any Government Licensing. We will help you to complete all your compliances concerning all the issues related to GST applicability-based as per your desired activities, ensuring the fruitful and well-timed completion of your work.&nbsp;&nbsp;<\/p>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/gstn-advisory-issues-on-gstr-1-3b-forms\/\">\nLatest: GSTN Advisory issues on GSTR (1&amp;3B) Forms<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Finance Ministry clarified that hand sanitizers would attract a standard duty rate of 18% under the GST regime as they come in the category of disinfectants like anti-bacterial liquids, soaps, Dettol, etc. According to Finance Minister, reduction in GST rate would help neither manufacturers nor consumers after receiving comments on the GST rates for essential [&hellip;]<\/p>\n","protected":false},"author":20,"featured_media":13287,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[16],"tags":[782],"acf":{"service_id":"68"},"authorName":"Archita Bhattacharjee","authorImageUrl":"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2020\/03\/WhatsApp-Image-2020-03-18-at-11.26.19-AM-1.jpeg","authorDescription":"Archita Bhattacharjee is working as Legal Analyst (Team Lead, Research &amp; Development) at Corpbiz and has proving experience about 2 years as Corporate Legal Researcher in law firms as well as Rajya Sabha and authors in diverse publications. She has refined her skills by representing India in Paris, France and the University of Leiden over implications of International Humanitarian and Criminal Law being certified member of many Legal Centers.","postViews":10195,"readingTime":3,"_links":{"self":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/13280"}],"collection":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/users\/20"}],"replies":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/comments?post=13280"}],"version-history":[{"count":17,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/13280\/revisions"}],"predecessor-version":[{"id":13303,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/13280\/revisions\/13303"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media\/13287"}],"wp:attachment":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media?parent=13280"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/categories?post=13280"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/tags?post=13280"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}