LUCKNOW,India - India will extend until the end of the year a reduction on taxes on drugs used for the treatment of COVID-19 infection, Finance Minister Nirmala Sitharaman said on Friday.

In June, India had cut taxes on medical equipment such as oxygen concentrators and drugs used to treat COVID-19 such as to 5% from 12-18%.

The cut had been due to expire this month, but the deadline was extended by the Goods and Services Tax (GST) council, comprised of state and federal finance ministers, which met physically after a gap of nearly two years.

Drugs covered by the extension of lower tax rates include Zolgensma, Viltepso, Remdesivir, Favipiravir and Itolizumab.

Coronavirus cases in the world's second-most populous country have fallen to below 35,000 a day after hitting a peak of 400,000 a day in May, data from the health ministry showed.

The GST council also made changes to rules to require food delivery services to collect an existing 5% tax on behalf of restaurants from January, describing this as a measure to reduce tax evasion.

"The impact on the end consumer is expected to be neutral where the restaurant is a registered one," said Mahesh Jaising, Partner, Deloitte India, adding there could be a 5% tax going forward on unregistered restaurants using these platforms.

Reporting by Aftab Ahmed Writing by Manoj Kumar Editing by Peter Graff

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