1. GST impact on disabled people: It is win-win situation for divyang users and domestic manufacturers; here’s why

GST impact on disabled people: It is win-win situation for divyang users and domestic manufacturers; here’s why

GST impact on disabled people: The government has said that the new tax regime would lead to a decrease in prices of specific devices used by disabled people.

By: | New Delhi | Updated: July 4, 2017 5:15 PM
GST impact on disabled people, gst impact on disabled people, gst effect, gst effect on disabled people, gst disabled people GST is expected to make equipment used by disabled people affordable.

GST impact on disabled people: Amidst concerns that the introduction of Goods and Services Tax (GST) has increased the prices of essential specific devices used by the divyang (or disabled/differently-abled) people, the government has said that the new tax regime would lead to a decrease in prices of such devices. The government has fixed 5% concessional GST rate on most of the devices and rehabilitation aids used by the divyangs.

According to a Ministry of Finance release, “Most of the inputs and raw materials for manufacture of these assistive devices attract 18% GST. The concessional 5% GST rate on these devices/equipment would enable their domestic manufacturers to avail Input Tax Credit of GST paid on their inputs and raw materials.”

The GST law provides for refund of accumulated Input Tax Credit in cases where the GST rate of output supply (the rate at which the item is to be sold) is lower than the GST rate on inputs used for their manufacture. This means, 5% GST rate on these devices would enable their domestic manufacturers to claim refund of any accumulated Input Tax Credit, resulting in reduction of the cost of domestically manufactured goods, as compared to the pre-GST regime.

So, what would have happened if these devices were exempted from GST? In such a case, the ministry says the import of such devices would be zero-rated, while the domestically manufactured such devices would continue to bear the burden of input taxes. It would have led to an increase in their cost, resulting in “negative protection for the domestic value addition.”

The Finance ministry says, “In fact, the 5% concessional GST rate on such devices/equipment will result in a win-win situation for both the users of such devices, the disabled persons, as well as the domestic manufacturers of such goods. It is for this reason that the Council has kept these items in 5% rate slab.”

The government has fixed the concessional 5% GST rate for these assistive devices and rehabilitation aids for physically challenged persons:

  • Braille writers and braille writing instruments;
  • Handwriting equipment like Braille Frames, Slates, Writing Guides, Script Writing Guides, Styli, Braille Erasers
    Canes, Electronic aids like the Sonic Guide;
  • Optical, Environmental Sensors;
  • Arithmetic aids like the Taylor Frame (arithmetic and algebra types), Cubarythm, Speaking or Braille calculator;
  • Geometrical aids like Combined Graph and Mathematical Demonstration Board, Braille Protractors, Scales, Compasses and Spar Wheels;
  • Electronic measuring equipment such as Calipers, Micrometers, Comparators, Gauges, Gauge Block Levels, Rules, Rulers and Yardsticks;
  •  Drafting, Drawing Aids, Tactile Displays;
  • Specially adapted Clocks and Watches;
  • Orthopaedic appliances falling under heading No.90.21 of the First Schedule;
  • Wheel Chairs falling under heading No.87.13 of the First Schedule;
  • Artificial electronic larynx and spares thereof;
  • Artificial electronic ear (Cochlear implant);
  • Talking books (in the form of cassettes, discs or other sound reproductions) and large-print books, braille embossers, talking calculators, talking thermometers;
  • Equipment for the mechanical or the computerized production of braille and recorded material such as braille computer terminals and displays, electronic braille, transfer and pressing machines and stereo typing machines;
  • Braille Paper;
  • All tangible appliances including articles, instruments, apparatus, specially designed for use by the blind;
  • Aids for improving mobility of the blind such as electronic orientation and obstacle detecting appliance and white canes;
  • Technical aids for education, rehabilitation, vocational training and employment of the blind such as Braille typewriters, braille watches, teaching and learning aids, games and other instruments and vocational aids specifically adapted for use of the blind;
  • Assistive listening devices, audiometers;
  • External catheters, special jelly cushions to prevent bed sores, stair lift, urine collection bags;
  • Instruments and implants for severely physically handicapped patients and joints replacement and spinal instruments and implants including bone cement.
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