The health industry has sought for a zero rate of GST for healthcare services and health insurance premiums. It has been said by the Confederation of Indian Industry that since GST is not payable on healthcare services, service providers are not eligible to avail credit on the input taxes paid by it. It is further said y the Confederation that “Many developed countries have adopted a similar position of providing ‘zero rating’ benefit to health care. This option will help in reducing the cost burden for healthcare providers, and give them the ability to pass on the benefit directly to the consumers.” It has also been recommended by the CII that if government is unable to normalize the rates of tax for the goods and services consumed by the health care service providers at 5% then it may levy GST at 5% on healthcare services delivery and health insurance premiums.
