HEALTH CARE SERVICE: GST Implication

HEALTH CARE SERVICE: GST Implication




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HEALTH CARE SERVICE: GST Implication

Taxation is a mode of revenue for Government of India. There are basically two types of taxation reforms i.e. Direct Tax and Indirect Tax. Goods and Service Tax (GST) is an indirect tax regime that shifts the burden on individuals.

Government works for the benefit of individuals and therefore it does not levy tax on few services that are necessary for life.

One such service notified by Government through its exemption notification is health care services.

Let’s discuss health care services in detail.

Health care services by the following are exempt under GST law:

a) Clinical establishment,

b) Authorised medical practitioner, or

c) Para-medics.

Even, service by way of transportation of patients in ambulance is also exempt if the same is not given by authorised medical practitioner, or Para-medics.

For understanding the exemption clearly we need to understand the term Health Care, Clinical Establishment, paramedics, etc.

  1. Health care services

The said notification defines Health Care services as any service by way of diagnosis or treatment or care for

  • illness,
  • injury
  • deformity,
  • abnormality or
  • pregnancy

in any recognized system of medicines in India.

It includes services by way of transportation of the patient to and from a clinical establishment,

The health care services explicitly exclude:

  • hair transplant or
  • cosmetic or plastic surgery,

However, if hair transplant or cosmetic or plastic surgery is undertaken to restore or to reconstruct anatomy or functions of body affected due to congenital defects, developmental abnormalities, injury or trauma the same shall not be excluded.

Thus, all treatments excluding cosmetic treatments have been covered by this definition.

  1. Clinical establishment

A Clinical establishment means

  • A hospital, nursing home, clinic, sanatorium or any other institution by, whatever name called that offers services or facilities requiring Health Care service as referred above or
  • A place established as an independent entity or a part of an establishment to carry out diagnostic or investigative services of diseases;
  1. Authorized Medical Practitioner

Authorized medical professional means: –

  • A Medical Practitioner registered with any of the councils of the recognized system of medicines established or recognized by law in India and
  • Includes a medical professional having the requisite qualification to practice in any recognized system of medicines in India as per any law for the time being in force.
  1. Paramedics

These are trained healthcare professionals like nursing staff, physiotherapists, technicians, lab assistants etc.

  1. Authorized medical professional:

The definition of authorized medical professional requires a practitioner to be registered with any medical council; and Practitioner should have requisite qualification to practice.

Such qualification should be of any system of medicine recognized in India. Following systems of medicine are recognized in India:

  • Allopathic
  • Ayurveda
  • Siddha
  • Unani
  • Homeopathy
  • Yoga
  • Naturopathy

Accordingly, qualified doctors holding recognized degrees in any of the above systems are covered in this entry if they are registered with their respective medical councils.

Other notified services in exemption notification relating to health care are

  1. Services provided by Cord/Other Blood Bank for preservation of stem cells or any other services for such preservation are covered in Entry No: 76 and are thus Exempt from GST.
  2. Treatment or disposal of bio waste facility given to clinical establishment is exempt.
  3. Services by veterinary clinic in relation to health care of animals or birds.

 


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