Getting treatment in hospitals has become expensive. A non-ICU room in a hospital whose rent exceeds Rs 5000 per day will attract 5% GST. In fact, the decision was taken in the 47th meeting of the GST Council held on 28-29 June, which has come into effect from 18 July 2022. However, this decision of the GST Council is also being criticized a lot.
From the healthcare industry to hospital associations and other stakeholders, there are calls for the government to roll back the decision. They say that levying GST on hospital beds will make the treatment costly. Also, it would complicate compliance issues in the healthcare industries, as the healthcare industry used to get concessions until now.
Suppose the hospital rent for a day is Rs 5000, then Rs 250 has to be paid as GST. If a patient stays in the hospital for two days, he will have to pay Rs 10,500 along with the rent of Rs 10,000. The longer a patient stays in the hospital, the higher the tax he will have to pay.
FICCI President Sanjiv Mehta has also written a letter to Finance Minister Nirmala Sitharaman saying that this will make the treatment of patients more expensive. Also, he has written in the letter that the rent of the hospital room is part of the package rate fixed for the treatment. Taxing a portion of the package would lead to confusion, which is against the government’s own objective. The government has asked the private sector to give information about the entire cost of treatment through package rates of patients in other health schemes under Ayushman Bharat, GMJAY scheme. This will also hinder the easing of the government’s efforts.
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