The Healthcare Federation of India (NATHEALTH) had commissioned a study to estimate the embedded taxes contained in the healthcare services segment. The embedded taxes arise as the Healthcare Services are exempt under GST, therefore the pass-over of taxes as visualised in the GST design doesn’t happen in the case of healthcare services. The study shows that the healthcare services are one of the few sectors where the incidence of taxes rose post GST due to limited pass-over of VAT taxes, which were possible under pre-covid scenario. The study shows that the healthcare services segment would benefit from a merit rate of taxation which will help to by and large absorb the embedded taxes and even when there are some embedded taxes, it would be refundable under GST law and could be used to spend on healthcare infrastructure.
As the entire exercise of GST rate structure rationalisation is under examination by a commission under GST council, NATHEALTH’s request is that at least a few important items, which account for a significant proportion of embedded taxes, could be brought to a merit rate, providing some relief to the healthcare services segment , and at least neutralise the increase of 1.5% post covid (in GST regime).
Towards this, NATHEALTH is organising a Workshop on GST over a virtual platform. The idea is to update on the progress, collect and galvanise thoughts and present the way forward.
We do hope you will join this important discussion and block your diary. RSVP your responses to email@example.com
We look forward to your participation.