Indian Medical Association Urges Withdrawal of GST on Healthcare Services

Concerns raised over the potential impact on healthcare costs and patient care

In a recent development, the Indian Medical Association (IMA) has requested Union Finance Minister Nirmala Sitharaman to reconsider the imposition of Goods and Services Tax (GST) on healthcare services. The IMA expressed concerns that the implementation of GST would significantly raise the cost of running hospitals and clinics across the country, potentially impacting patient care and accessibility to quality healthcare services.

The impact of GST on medical facilities and patients

The IMA highlighted two specific recommendations by the 47th GST council that could have significant implications for the healthcare sector. The first recommendation involves taxing common bio-medical waste treatment facilities and common treatment facilities for treatment or disposal of biomedical waste at a rate of 12 percent, despite these facilities being exempted from GST in the past. The IMA argued that this steep rise in taxes on biomedical waste is unjustified and would result in increased operational costs for healthcare facilities, ultimately leading to higher charges for patients.

The second recommendation focuses on taxing room rent exceeding Rs 5,000 per day per patient, excluding ICU, at a rate of 5 percent without input tax credit. The IMA pointed out that this facility was previously exempted from GST and now falls under the purview of the tax norms. The association expressed its concern that taxing room rent in hospitals would lead to higher basic bed rates, effectively profiteering from the suffering of patients. The IMA drew a parallel to the historical “Salt Tax” imposed by the British on Indians, highlighting the unjust nature of taxing essential healthcare services.

 A plea for the withdrawal of GST on healthcare services

The IMA, as the representative body of healthcare establishments and doctors in the country, raised several valid concerns regarding the impact of GST on the healthcare sector. They argued that the implementation of GST on healthcare services would push the sector towards a business-oriented model rather than a service-centric one. The IMA emphasized that this would be unfair to citizens already facing numerous hardships and would result in increased financial burdens on patients.

The association further expressed its disappointment with the current state of the healthcare system in India, citing inadequate government spending on health and the heavy reliance on the private sector, leading to high out-of-pocket expenditures for patients. The addition of GST on healthcare services would exacerbate these existing challenges, making healthcare less affordable and accessible for the general population.

In conclusion, the Indian Medical Association has strongly urged the Union Finance Minister to reconsider the implementation of GST on healthcare services. The IMA’s concerns primarily revolve around the potential increase in healthcare costs and the adverse impact on patient care. With healthcare in India already facing significant challenges, it is crucial to ensure that access to quality healthcare remains affordable and readily available to all.

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