Healthcare Services to be under the GST Network | DocMode
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Healthcare Services to be under the GST Network

The government will put those healthcare services under the GST network, tapping on a sensitive area, as it aims to give the income mobilization a leg hit hard in the ongoing economic slowdown. According to official sources, the Ministry of Finance, which had discussions with state governments on steps to raise GST revenue, is likely to recommend adding premium healthcare services to the GST system at levels of either 12 or 18%. These could involve high-value devices and medications given to patients seeking premium services from a supplier of health care (hospitals, nursing homes). All healthcare services by a clinical establishment or authorized medical practitioner by way of diagnosis or treatment or care for illness, injury, deformity, abnormality or pregnancy are currently exempt from GST. However, hair transplant or cosmetic or plastic surgery does not get an exemption and is taxed. Similarly, while medications attract nil, 5, 12, and 18 percent GST rates, drugs used during hospitalization are not taxed. The Center will ensure that baseline GST collections rise by 14 percent each year and address any deficiency. Under the work plan for charging healthcare services, the idea is to make it obligatory for hospitals to bill individually for medications and hospitalization costs. This is also anticipated to improve tax collections from healthcare providers thus plugging the gap in GST collections. Once this division exists, medical items used during hospitalization would also be taxed. This is expected to increase the cost of healthcare facilities, but it would allow clear hospital bills. In addition, a threshold may be given to all healthcare services in hospitals in terms of actual spending on the service. If that expenditure exceeds a prescribed threshold, GST may be charged for services that currently receive full exemption. This would mean that the same could be charged if a person in a facility is using luxury room care. For implants and other high-value specialized consulting services, the same concept can apply.



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