Will GST mitigate the cascading effects of multiple taxes on healthcare?

In India, the healthcare sector has grown magnanimously since the last century. Today, the contribution of healthcare to the country’s gross domestic product (GDP) is pegged at 5 per cent. From $ 80 billion in 2012, the healthcare sector is expected to reach $ 150 billion by 2020. Government reforms have played a prominent role in encouraging foreign investments, developing new technologies and defining protocols, to further support this expansion. The Goods and Services Tax (GST) Bill too, was anticipated to aid advancement in the healthcare space. 

In the past few months the GST Bill had been the sum and substance of many debates and speculations within the healthcare industry. However, the government’s decision to keep healthcare out of its gambit, has been a boon for companies as well as consumers. Such a move will help quality healthcare penetrate into nooks and corners of the country, making it not only accessible across urban as well as rural areas, but also affordable for consumers with diverse socio-economic backgrounds, since drastic hikes or reductions in healthcare costs can be avoided. The proposed regulations under GST may also be a boon for increased foreign investments due to tax stability, and a similar dispensation must be maintained at least for the next decade to facilitate increased quality.