GST on medical services Extract of Notification No. 12/2017 Central Tax (Rate) New Delhi, the 28th June, 2017 G.S.R......(E). In exercise of the powers conferred by subsection (1) of section 11 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on being satisfied that it is necessary in the public interest so to do, on the recommendations of the Council, hereby exempts the intraState supply of services of description as specified in column (3) of the Table below from so much of the central tax leviable thereon under subsection (1) of section 9 of the said Act, as is in excess of the said tax calculated at the rate as specified in the corresponding entry in column (4) of the said Table, unless specified otherwise, subject to the relevant conditions as specified in the corresponding entry in column (5) of the said Table, namely:
Services by way of
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Heading 9993
1. health care services by a clinical establishment, an authorised medical practitioner or paramedics; Nil Nil 2. services provided by way of transportation of a patient in an ambulance, other than those specified in (a) above.
Definitions: A. Health Care Services
Health care services implies to improvement and maintenance of physical and mental health. Application of all the health care services in any recognized system of medicines in India except hair transplant, cosmetic surgery or plastic surgery and the ones done due to congenital defects, development abnormalities, trauma or injury are exempt from the ambit of GST.
B. Clinical Establishment
It includes any hospital, nursing home, maternity clinic, dispensary, clinic, sanatorium, pathology, or any other diagnostic or investigative services owned and controlled by
Government or a department of government,
A trust,
A corporation including society,
Local authority, and,
Any single medical practitioner.
Clinical establishments do not include any establishments owned, controlled and managed by the armed forces. C. Authorized Medical Professional
Any practitioner registered with any council of recognized system of medicine or any recognized medical law in India and having a qualification to practice in any recognized system of medicine in India, excluding hair transplant or domestic surgery are exempt from paying GST in India. D. Paramedics
Any trained professional such as a nursing staff, physiotherapist, technicians, lab assistant are accountable for their services when provided independently, are therefore exempt. Nil GST on Medical Services
Health care services for both humans and animals (veterinary medical services) are included in the GST Act. Under existing rules, there is nil GST on health care services provided by an authorized medical practitioner, licensed medical or paramedical clinic. The same nil GST rate also applies to any and all medical services provided during transportation of a patient by ambulance. In case of veterinary health care services provided to birds/animals at authorized clinics, the applicable GST rate is also nil. Nil GST on Medicines used during Hospitalization
Initially there was confusion regarding GST charges on medicines and other medical consumables used during hospitalization (inpatient treatment). In response to a query on this issue, the Authority of Advance Ruling (AAR) in Kerala has ruled that supply of medications, implants and other consumables used (e.g. diagnostic supplies and surgical equipment) during hospitalization will feature nil GST. As per the AAR, these are to be included as part of composite supplies included as part of healthcare services hence the nil GST rate will be applicable. This advance ruling is applicable to treatments carried out at all registered hospitals, clinics and physicians across India.
Whether doctors are required to register under GST? Registration on the basis of turnover
GST law requires registration on the basis of turnover. It provides a threshold turnover exemption up to Rs 20 lakh from registration. While determining the turnover for threshold exemption, one has to see the total turnover (exempt + nonexempt) Let’s see whether doctors would be required to register under GST under the following cases: 1. Where the doctors are engaged only in healthcare services?
Provision of Health care services, as explained earlier, is an exempt service and since the services are exempt, it also exempts from registration. So, the doctors who are engaged only in exempt health care services are providing only exempt services and thus they aren’t required to register under GST. 2. Where the doctors are also engaged only in nonhealthcare services
Nonhealth care services aren’t exempt under GST. A Doctor providing both health care & nonhealth care services has to consider the total turnover from health care & nonhealth care services. Thus, if the total turnover from all services exceeds Rs 20 lakhs, GST registration would be required. For instance, A doctor is practicing in a hospital with a turnover of 18 lakhs and also selling educational videos online with a turnover of 7 lakhs. Here, while the turnover from practice is 18 lakhs. In order to determine whether GST registration is required, one needs to see the total turnover i.e. turnover from practice + turnover from educational videos, which is this case is 25 lakhs. So, GST registration would be required. As per GST law, “aggregate turnover” refers to the aggregate value of
Taxable sales value
Exempt sales value
Export of goods and services
Interstate supplies by the business to its sister concern under the same PAN or interstate stock transfer or supplies between distinct persons under the same PAN. However, the above sum excludes the tax components such as the Central tax, State tax, Union territory tax, Integrated tax and Cess.
