• 17 Jul 2022 04:20 PM
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Withdraw GST on healthcare, IMA asks Finance Minister Nirmala Sitharaman

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The Goods and Services Tax (GST) will increase the cost of operating hospitals and clinics in the nation, the Indian Medical Association (IMA) told Finance Minister Nirmala Sitharaman.

The Goods and Services Tax (GST) will increase the cost of operating hospitals and clinics in the nation, the Indian Medical Association (IMA) told Finance Minister Nirmala Sitharaman.

These facilities were previously included in the GST exempt category and would be subject to tax after July 18. This is in reference to a recommendation by the 47th GST council that stated that "room rent, excluding ICU, exceeding 5,000 per day per patient charged by the hospital will also be taxed at 5 per cent, without input tax credit (ITC)".

Also Read | Impact of 5% GST on non-ICU hospital rooms not significant: Revenue secretary

Another request made by the IMA was also referenced, which said that "room rent, excluding ICU, exceeding 5,000 per day per patient charged by the hospital will also be taxed at 5 per cent, without input tax credit (ITC)". In its letter, the IMA claimed that this facility was also GST (Goods and Services Tax) free and will now be subject to the GST regulations as of July 18.

"We, as the collective voice of all establishments and doctors of the country, express our serious concerns and objections to these new taxes in the healthcare sector. This step will add a big additional cost to the healthcare of people," the IMA's letter stated.

"We request you to immediately withdraw any GST on healthcare services," it said.

India's healthcare system is already off course due to low government investment on healthcare, the IMA further declared. Individuals are heavily reliant on the private sector and incur high out-of-pocket costs, it noted.. The decision to introduce GST will only result in an increase in the cost of basic rooms, it claimed.

"Taxing room rent in a hospital is profiteering from the suffering of a sick person. It is no less than the 'Salt Tax' imposed by the British on Indians for which even the Father of our Nation Mahatma Gandhi had to protest," the IMA said in the letter.

Similar to the previous statement, it claimed that a sharp increase of 12% on biological waste is unwarranted and will increase the cost of operating hospitals and clinics. The letter added that it would further translate into higher patient fees.

"Application of GST will push healthcare towards a business model away from a service-centric one, and it will not be fair to our citizens already facing many hardships. So, it is our sincere and immediate request to withdraw the GST on room rent and biomedical waste in the larger interest of public healthcare," the IMA added.