FICCI seeks zero-rating GST on healthcare services

New Delhi: Industry body FICCI has sought zero-rating GST on healthcare services to enable the service providers to claim input tax credit.

In a letter to the Finance Minister Nirmala Sitharaman, the chamber's President Sanjiv Mehta said "enabling this would not only ensure that the input tax credit chain is intact but will also make compliances easier and ensure that the input taxes are not loaded into the cost of healthcare

services".

"Hence, it is our sincere request that the exemption of healthcare services from Goods and Services Tax may kindly be discontinued, and the healthcare providers be allowed to avail the input tax credit," he added.

Sharing its views on the recommendations made in the recent GST Council meeting, the chamber said the incorporation of 5 per cent Goods and Services Tax on room rent (exceeding Rs 5,000 per day) will go on to increase the cost of healthcare service to the patients.

"Further, the room rent is usually a part of the package rate for a treatment, and taxing only one component of the package will create confusion and will lead to deconstructing of the packages, which is against the current practice being encouraged by the government," the FICCI President said in the letter.

He said under Ayushman Bharat-PMJAY scheme and other health insurance schemes, the government has been encouraging the private sector to keep the patients informed of the cost of entire treatment through package rates.