New Delhi: The Medical Technology Association of India (MTaI) has welcomed the concept of Goods and Services Tax (GST) and congratulated the Government for finally taking this much-awaited step.
“The healthcare sector, that MTaI members contribute to, is a key priority of the Government in terms of service quality and reach. India spends just about 1.3% of the GDP on healthcare, and 70% of the healthcare spending in the country is out-of-pocket. The Government has implemented several measures to keep these services affordable to the common man,” stated the Association’s statement released to press on evening of 17th July 2017.
However, the MTaI raised its fears on the increase in the medical costs due to uneven GST rates. “The current GST dispensation for healthcare that keeps the hospital services exempt from GST (which also means that the hospitals will not be able to avail input tax credit) and fixes rates that range from 5%-28% on medical devices will do little to lower the existing medical costs for the common man. In line with our earlier recommendation, it would have helped if the medical services were zero-rated, similar to exports, where full tax credit against inputs would be refundable, and all devices were taxed at a standard rate of 5% GST.”
“A lower and uniform GST rate of 5%, when combined with the anti-profiteering law would have helped to bring down the cost of medical service to patients, and also attract investments to the sector and expand reach”