The GST Council has recommended 5% Goods and Services Tax (GST) without the input tax credit (ITC) on room rent (excluding ICU) exceeding Rs 5,000 per day per patient charged by a hospital.
However, an association of hospitals has protested against the government’s move of imposing GST on hospital bed rents, observing that hospitals would have no other option but to pass on the burden to the patients.
Regarding this, Girdhar Gyani, director general of Association of Healthcare Providers (India) said, “On one hand the government shows concerns on making healthcare services affordable, while on the other it is putting extra burden through taxation of such kind. Hospital beds are not hotel beds. Patients do not come for business or recreation but to address health issues.”
“There has never been a GST on beds, or diagnostics. The bed charge is part of care for the patient. We are worried that next will be a treatment like surgery. This is sending wrong signals to the providers of healthcare. It will enhance costs for patients and insurance,” Gyani added.
“This is an issue of serious concern as it will put an extra financial burden on hospitals. Considering that hospitals are already facing severe financial sustainability issues, they will have no option but to pass on this burden to patients,” AHPI, representing a vast majority of private hospitals said in a statement.
The association has called upon the Union Finance Minister to withdraw this recommendation, noting that there are factors considered by hospitals to determine the bed charge.