Health care services in India is exempt from GST vide exemption notification number 12/2017. As per the notification, following health care services are exempted from GST.
- Services by a veterinary clinic in relation to health care of animals or birds.
- Services by way of (a) health care services by a clinical establishment, an authorised medical practitioner or para-medics and (b) services provided by way of transportation of a patient in an ambulance, other than those specified in (a) above.
- Services provided by the cord blood banks by way of preservation of stem cells or any other service in relation to such preservation.
What is Health care services
As per the notification, health care services means any service by way of diagnosis or treatment or care for illness, injury, deformity, abnormality or pregnancy in any recognised system of medicines in India and includes services by way of transportation of the patient to and from a clinical establishment, but does not include hair transplant or cosmetic or plastic surgery, except when undertaken to restore or to reconstruct anatomy or functions of body affected due to congenital defects, developmental abnormalities, injury or trauma.
Recognised system of medicine means Allopathy, Yoga, Naturopathy, Ayurveda, Homoeopathy, Siddha and Unani System of medicines or any other system of medicine as may be recognised by the Central Government.
Who is authorised medical practitioner
authorised medical practitioner means a medical practitioner registered with any of the councils of the recognised system of medicines established or recognised by law in India and includes a medical professional having the requisite qualification to practice in any recognised system of medicines in India as per any law for the time being in force.
What is clinical establishment
clinical establishment means a hospital, nursing home, clinic, sanatorium or any other institution by, whatever name called, that offers services or facilities requiring diagnosis or treatment or care for illness, injury, deformity, abnormality or pregnancy in any recognised system of medicines in India, or a place established as an independent entity or a part of an establishment to carry out diagnostic or investigative services of diseases;
Is public health care services by a charitable trust exempt from GST
Services provided by an charitable trust registered U/s 12AA of income tax act, 2017 for public health by way of care or counseling of terminally ill persons or persons with severe physical or mental disability, persons afflicted with HIV or AIDS, persons addicted to a dependence-forming substance such as narcotics drugs or alcohol is exempt from GST.
GST exemption is also available if services are provided for public awareness of preventive health, family planning or prevention of HIV infection.
Clarification by CBIC on GST exemption applicable to healthcare services
CBIC through various circulars has clarified certain services to be exempted from GST. We have listed a few circulars below and services provided by healthcare services exempted from GST.
Room rent in hospitals is exempt – Circular No. 27/01/2018 GST dated 04.01.2018
Hospitals hire senior doctors/ consultants/ technicians independently, without any contract of such persons with the patient and pay them consultancy charges, without there being any employer employee relationship. Will such consultancy charges be exempt from GST? As clarified by government vide circular number 32/06/2018 dated 12.02.2018, services provided by senior doctors / consultants / technicians hired by the hospitals, whether employees or not, are healthcare services which are exempt from GST.
Amount charged by hospitals from the patients including the retention money and the fee / payments made to the doctors etc. towards the healthcare services provided by the hospitals to the patients is exempt from GST. Healthcare services have been defined to mean any service by way of diagnosis or treatment or care for illness, injury, deformity, abnormality or pregnancy in any recognised system of medicines in India [circular number 32/06/2018 dated 12.02.2018].
Food supplied to the in-patients as advised by the doctor or nutritionists is a part of composite supply of healthcare and not separately taxable. Other supplies of food by a hospital to patients (not admitted) or their attendants or visitors are taxable [circular number 32/06/2018 dated 12.02.2018].