In an effort to manage the state's economy during the COVID-19 pandemic, the DMK government in Tamil Nadu has written to the Prime Minister, requesting zero Goods and services tax (GST) on specified items including vaccines and drugs to treat COVID-19. These requests and suggestions from the state come at a time when they have announced global tenders for vaccines in Tamil Nadu.
"The state governments have been procuring medicines and vaccines needed to control the pandemic by themselves. In view of this, the Chief Minister has discussed with the GST council and has requested Prime Minister Narendra Modi to announce zero GST on these items for a specified period of time," reads an announcement on the communication which was made.
The state has also made an additional list of suggestions for the Union government to aid their battle against COVID-19 while also helping them fuel their economic resources.
This includes -
1. Immediate release of pending GST dues and the food grain subsidies payable to state civil supplies corporations,
2. Since the Union government has not given a share in the taxes on fuel, it has to consider giving grants-in-aid to the states on an ad-hoc basis to compensate for the loss.
3. Since all these expenses require more finance, the union government should allow the states to borrow 1% higher than the current 3% of the states' GDP.
The Tamil Nadu government on Wednesday announced that it will be floating global tenders to procure vaccines for residents aged 18-44 in the state. Chief Minister MK Stalin decides to invite global tenders given the vaccine shortage in the state. In its latest policy, the Union government had made it clear that procuring vaccines for residents aged below 45 was the responsibility of state governments.