The GST on aids and appliances for persons with disabilities
Context: GST on aids, appliances for disabled points to government’s misplaced priorities Introduction: ·The government imposed GST on aids and appliances for persons with disabilities. ·Crutches, calipers, hearing aids, walking frames-all replacements, albeit artificial, for body parts along with a host of other aids and appliances which the disabled persons use would attract a GST of 5 per cent. · In comparison, items used to embellish your body, will attract less and in some cases, no GST. So, while kajal, kumkum, bindi, bangles and even human hair are not taxed at all, gold and diamonds will attract a GST of just 3 per cent Impact of Law:
- Such a taxation law could harm to the interests of disabled persons.
- The fact that without aids and appliances the disabled are deprived of all these appliances and forced into a disempowered state of seclusion has been ignored.
There are two reasons why aids and appliances for disable people have not been exempted from the GST:
- GST rate at 5%:
- It needs to be clarified that under the GST, the most beneficial rate of tax on any item is 5 per cent. Aids and appliances for disabled people are taxed at this rate.
- This allows the suppliers of these items to claim an input tax credit for the GST paid on the inputs and input services used for supplying these items.
- Most of the inputs and input services are in the 18 per cent GST rate category.
- Some of the sophisticated electronic inputs are under the 28 per cent rate.
- No supplier of these items will pay GST from his pocket and the input tax credit will always be more than sufficient for discharging the GST liability.
- Under the GST, input tax credit or refund is not available for those goods on which the GST rate is zero percent.
- If the GST rate had been kept at zero per cent for these items, the suppliers would not have been able to avail of the input tax credit. This would have made these items expensive.
- Exemption from GST:
- Is such goods were exempt from GST, and then on imports of similar items too, the corresponding integrated GST would have to be kept at zero per cent.
- This will increase the competition for domestic manufacturers of these items, as they will not be able to avail the input tax credit on the inputs and inputs services used for the manufacture of items for the disabled, which in turn will increase their cost and make them non-competitive with respect to imported aids and appliances.
- This is against the national interest and would result in a loss of jobs in the units of the Indian manufacturers.