What is the GST rate on doctors consultation fees?
rootal- 08 Mins
- 20-09-24
- GST on Healthcare Services & its Applicability
- Exemptions of Health Care Services
- Which Health Services Are Taxable under the GST?
- GST on Medicine Taxability
- Impact of GST on Healthcare Services
- GST on Doctors' Consultation Fees
- Products and Medications Subject to 12% and 5% GST
- SAC Code for Hospital, Doctor and Medical Services
- GST Rate for Medical, Hospital, Doctor and Social Services
- Conclusion
Key Takeaways
- Healthcare services like hospitals and paramedics are exempt from GST, reducing treatment costs.
- Doctor's consultation fees are GST-free, but some medicines attract 5% or 12% GST.
- Cosmetic procedures such as plastic surgery are taxable and not exempt from GST.
- Essential medicines like insulin and vaccines have 5% GST, while others can have up to 12%.
- GST's impact has streamlined healthcare taxation and boosted medical tourism and alternative medicine in India.
The Goods and Services Tax (GST) is levied in India on the supply of goods and services. However, several medical and healthcare services are exempt from GST in India. This makes medical treatment less expensive compared to GST-inclusive costs.
In this blog, we will uncover the healthcare services that are free from GST and the applicable GST on doctor’s consultation fees. We will also navigate through the medicines taxed at 5% and 12% GST in India, and, finally, understand how GST has reshaped the landscape of healthcare services nationwide.
GST on Healthcare Services & its Applicability
Healthcare services include services provided for illness, injury, deformity, pregnancy and abnormality. It further includes patient transportation to and from a clinical establishment. However, it excludes services such as plastic surgery, cosmetic surgery and hair transplant.
Based on the inclusions and exclusions in healthcare services, the GST rates apply. There are applicable GST rates of 5%, 12%, 18% and 28% in India. However, there are certain restrictions and exemptions to GST applicability in the case of healthcare services in the country.
For instance, no healthcare and medical services have a 28% GST applicability in India. You can learn about the exemptions and GST applicability rates in the following sections.
Exemptions of Health Care Services
Notification number 9/2017 exempts healthcare services from GST. Here are the details of the same:
A. Health Care Services
Healthcare services include those pertaining to physical and mental health. In India, healthcare services in recognised systems of medicine are exempted from GST. However, there are certain exceptions, such as hair transplant, cosmetic surgery, plastic surgery, congenital defects, development abnormalities, trauma and injury, that are not exempt from GST.
B. Clinical Establishment
Clinical establishments are further exempt from GST. This includes hospitals, nursing homes, maternity clinics, dispensaries, sanatorium pathology or diagnostic centres owned by the following parties:
- Government or a government department
- A trust
- A corporation that includes society
- Or a medical practitioner
However, clinical establishments exclude any establishment owned and controlled by the armed forces.
C. Authorised Medical Professional
A medical practitioner qualified to practice and registered with any council of recognised systems of medicine or medical law in India is exempt from GST. However, exceptions include medical practitioners associated with hair transplants or domestic surgery.
D. Paramedics
Trained medical professionals such as physiotherapists, nursing staff, technicians and lab assistants are exempt from GST provided they work independently.
Which Health Services Are Taxable under the GST?
GST refers to tax levied on the supply of goods and services. The supply of services is exempt from GST in the healthcare domain. Services include those provided by senior doctors, consultants and technicians, the amount that the hospital charges from patients, and food that the hospital supplies to admitted patients. However, the food supplied to patients who are not admitted is taxable under the GST regime.
GST on Medicine Taxability
Certain medicinal supplies are taxable while others are exempt from GST. Here is a list of medicines and their tax applicability rates, including those that are exempt from GST.
| Description | CGST Rates | SGST Rates | IGST Rates |
| Insulin | 2.5% | 2.5% | 5% |
| Animal/ human blood vaccines | 2.5% | 2.5% | 5% |
| Diagnostic kits for the detection of all types of hepatitis | 2.5% | 2.5% | 5% |
| Desferrioxamine injection/ deferiprone | 2.5% | 2.5% | 5% |
| Cyclosporin | 2.5% | 2.5% | 5% |
| Medicaments (also including veterinary medicaments) which is used in biochemical systems and which do not bear a brand name | 2.5% | 2.5% | 5% |
| Oral rehydration salts | 2.5% | 2.5% | 5% |
| Drugs/ medicines (including their salts) and esters and diagnostic test kits as specified in List 1 to notification no. 1/2017- Central Tax (Rate). | 2.5% | 2.5% | 5% |
| Formulations manufactured from the bulk drugs as specified in List 2 to notification no. 1/2017- Central Tax (Rate). | 2.5% | 2.5% | 5% |
| Other drugs and medicines which are intended for personal use | 6% | 6% | 12% |
| Drugs/ medicines (including their salts) and esters and diagnostic test kits as specified in List 1 and Formulations manufactured from the bulk drugs as specified in List 2 to notification no. 1/2017- Central Tax (Rate) which is intended for personal use | 2.5% | 2.5% | 5% |
| Human blood and its components | NIL | NIL | NIL |
| All the types of contraceptives | NIL | NIL | NIL |
Impact of GST on Healthcare Services
GST has a positive impact on healthcare services irrespective of some issues pertaining to the healthcare sector's classification and applicability. The GST regime being a unified tax system, has replaced eight taxes in the healthcare sector.
One of the core issues in the healthcare sector taxes has been regarding the inverted duty structure that adversely impacted domestic manufacturers. However, the refund concept in GST has been an appropriate solution for the same. This is further boosting the growth of the healthcare sector.
Estimates reflect that the cost of the healthcare package has been around 30% to 40% of medical treatments in the first world countries. Nevertheless, GST has effectively projected the growth of the sector in terms of medical tourism.
In addition, India emphasises alternative medical practices such as Yoga, Unani, Sidha, Ayurveda, Homoeopathy and Acupuncture. The introduction of GST has further been effective in boosting medical tourism in India for alternative medical treatments. Thus, the GST regime has been effective in contributing to the economic development of the nation.
GST on Doctors' Consultation Fees
Doctor's consultation fees in India are exempt from GST. However, some medications that doctors prescribe are subject to 12% and 5% GST. In addition, health insurance attracts an 18% GST in India apart from the exempted medical or healthcare services.
Products and Medications Subject to 12% and 5% GST
| Products and Medications Subject to 5% GST | 12% Goods and Services Tax (GST) Rate on Medical Products |
| Vaccines derived from human or animal blood, insulin, diagnostic kits for detecting various hepatitis types, oral rehydration salts, medications such as Dopamine, Penicillamine, Protamine, BCG vaccine, Streptomycin, Pyrazinamide, Hydrocortisone, Quinine, in addition to 200+ other specified drugs, Influenza Vaccine, artificial kidneys, disposable sterilised dialyzers or micro barriers for artificial kidneys, orthopaedic devices including crutches, artificial limbs, surgical belts, and trusses, fracture appliances, splints, artificial body parts, components of wheelchairs, braillers, crutches, tricycles, walking frames, coronary stents and stent systems used with cardiac catheters, infant milk food, ostomy appliances, and COVID-19 diagnostic test kits. | Animal blood used for therapeutic, prophylactic, or diagnostic purposes, antisera, blood fractions, toxins, microorganism cultures (excluding yeasts), modified immunological products, medicaments from ayurvedic, homoeopathic, Unani, Siddha, or biochemical systems, bandages, wadding, gauze, tooth powder, feeding bottles and their nipples, surgical and medical examination rubber gloves, dental and veterinary apparatus, X-ray machines, contact lenses, spectacle lenses, corrective spectacles, blood glucose monitoring systems (glucometer) with test strips, medical-grade hydrogen peroxide and medical-grade oxygen Concentrators. |
SAC Code for Hospital, Doctor and Medical Services
There are two categories of SAC headings wherein the SAC code for hospital, doctors and medical services are distributed. While a significant majority of doctor and hospital services are in the category of social care and human health services, other services like veterinary services are in the category of professional, technical, and business services.
Here are the SAC codes for different healthcare services illustrated in the table below:
| Category | SAC Code | Specifications |
| Human Health Services | SAC code 999311 | Inpatient services |
| SAC code 999312 | Medical and dental services | |
| SAC code 999313 | Childbirth and related services | |
| SAC code 999314 | Nursing and Physiotherapeutic services | |
| SAC code 999315 | Ambulance services | |
| SAC code 999316 | Medical Laboratory and Diagnostic-imaging services | |
| SAC code 999317 | Blood, sperm and organ bank services | |
| SAC code 999319 | Homoeopathy, Unani, Ayurveda, naturopathy, acupuncture | |
| Residential care services for the elderly and disabled | SAC code 999321 | Residential healthcare services other than by hospitals |
| SAC code 999322 | Residential care services for the elderly and persons with disabilities | |
| Other Social Services without accommodation | SAC code 999351 | Child day-care services |
| SAC code 999352 | Guidance and counselling services n.e.c. Related to Children | |
| SAC code 999353 | Welfare services without accommodation | |
| SAC code 999359 | Other social services without accommodation | |
| Other Social Services with accommodation | SAC code 999331 | Residential care services for children suffering from mental retardation, mental health illnesses or substance abuse |
| SAC code 999332 | Other social services with accommodation for children | |
| SAC code 999333 | SAC code 999333 | |
| SAC code 999334 | Other social services with accommodation for adults | |
| Social Services without accommodation for the elderly and disabled | SAC code 999341 | Vocational rehabilitation services |
| SAC code 999349 | Other social services without accommodation for the elderly and disabled |
GST Rate for Medical, Hospital, Doctor and Social Services
The majority of the medical and healthcare services such as clinical establishments, authorised medical practitioners and paramedics. Veterinary services, cord blood bank services and patient transportation by ambulance are exempt from GST.
However, services that are not exempt from GST in the healthcare sector attract an 18% GST. If the mentioned services are not provided by clinical establishments, authorised medical practitioners and paramedics, they attract GST. Notably, no medical services attract 28% GST in India.
Conclusion
GST on doctor's consultation fee is zero as the doctor's consultation charge is exempt under the GST regime. Similarly, the majority of the healthcare services are exempt from GST such as clinical establishment, paramedics and other authorised medical practitioners.
However, certain medications attract 12% and 5% GST as they are not exempt under the GST regime. Knowing the medications that attract GST can enhance your awareness about GST applicability in healthcare services.
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FAQs
Are healthcare services in India exempt from GST?
Is GST applicable on doctor’s consultation fees?
What medicines are taxed under GST in India?
Are clinical establishments subject to GST?
How has GST affected healthcare costs in India?
by rootal
Key Takeaways Healthcare services like hospitals and paramedics are exempt...
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