5% service tax on healthcare

Emphasising that through this service tax is on high end treatment, Mukherjee said that there would be an abatement of 50 percent so that the actual burder is kept 5% of the value of service.

The Union Finance Minister Pranab Mukherjee while presenting the union Budget for 2011-12 has announced that the service tax on health check up or treatment imposed in 2010-11 would now be replaced with a tax on all sevices provided by hospitals with 25 or more beds that have the facility of central air conditioning.

Emphasising that through this service tax is on high end treatment, Mukherjee said that there would be an abatement of 50 percent so that the actual burder is kept 5% of the value of service. The finance minister said that levy would be extended to diagnostic tests of all kinds with the same rate of abatement. All government hospital would be outside this levy.

5% service tax on healthcare

Modern healthcare as it is beyond the affordability of a common man. It is a known fact that ,the public sector by it self is not geared up to provide Medicare to all. The Govt. should in fact, consider making “Health Check Up” cheaper by giving benefits like subsidized so that the load on the healthcare industry is reduced by controlling health related problems at preventive stage rather than the curative stage”. Health belongs to the service sector hence we should underline the Social Contract rather than the business contract in healthcare.

5% service tax on healthcare

Noted cardiac surgeon Dr Devi Shetty launched a nation-wide appeal - calling this a ‘misery’ tax.
“India spends less than 1per cent of its GDP on health care..less than 10 per cent of the population can afford heart surgery, or even cancer treatment,” said Dr Devi Shetty, Cardiologist and Chairman, Narayana Hrudaylaya.

5% service tax on healthcare

“My plea to finance minister is that they’re already stretched, lets not burden them further, said Dr Naresh Trehan, Chairman and MD, Medanta The Medicity”.