Healthcare Union Budget: Hospital CFOs voice ineligibility for Input Tax Credit in GST as a major concern, Health News, ET HealthWorld


0


New Delhi: As we inch closer to Union Budget 2023-24 to be tabled on February 1 by Union Finance Minister Nirmala Sitharaman, the CFOs from the leading hospitals have been sharing their demands around the need for strengthening healthcare infrastructure, problems faced with GST, focussed approach towards preventive care from this year’s budget.

ETHealthworld connects with hospital CFOs to understand their expectations from the Union Budget 2023-24. The financial honchos have urged the government to address input tax credit issue for hospitals in the GST, to allocate more funds in the forthcoming budget to get closer to its target of 2.5 per cent of the GDP, and relook at the GST regime amongst others.

Hospital CFOs voice ineligibility for Input Tax Credit in GST as a major concern

Healthcare industry not eligible for input tax credit a major drawback

Vivek Kumar Goyal, CFO, Fortis Healthcare Limited: During the COVID-19 pandemic, we have all seen how we have faced a healthcare shortage in the country. There is not only a need to augment the healthcare infrastructure in the country but also increase medical education to meet the growing need for doctors and nurses. For that, the government needs to allocate more funds in the forthcoming budget to get closer to its target of 2.5 per cent of the GDP. The government should also encourage the private sector to invest more in the healthcare industry by providing them incentives like industry loans, soft loans for a longer tenure. Healthcare is generally a long gestation period projects; they should also encourage the private sector to invest in medical education for more private medical colleges.

GST regime needs to be relooked at. Currently, the healthcare industry is not eligible for input credit, and that is a major drawback for the industry because it pays taxes on most of its services, and the industry is paying taxes without getting any input credit benefit. The government should allow a refund of the tax paid on healthcare services to make it more affordable to the general public.

There is also a need to re-examine the tax imposed on the import of medical equipment and life-saving drugs. Because most of the healthcare equipment is imported from outside, a similar situation exists for drugs. This will really help augment healthcare in the country.

Currently, under the Income Tax Act, there is a tax benefit of Rs 5,000 on preventive healthcare, which should be increased to Rs 10,000. Another area on which the government should focus is on medical tourism, as this is a big opportunity for a country like ours where we have a good infrastructure and can really utilise that infrastructure by increasing patients from outside the country.

Hospital CFOs voice ineligibility for Input Tax Credit in GST as a major concern

Need to fix payment and pricing problem with government health schemes

Sandhya J, Group Chief Financial Officer, Narayana Health: We believe that the government must solve input tax credit issue for hospitals in the GST. Otherwise, the burden is getting passed on to the patients. The government must fix the payment and pricing problems with the government’s health schemes. The cost of imported medical equipment is very high, compounded by currency fluctuations.

We need more doctors and nurses. The government has to simplify our medical education system, invest in it, so that, we are able to create more medical professionals in this country. Secondly, the primary healthcare and community health centres in rural areas have to be strengthened. If the patient has access to more primary care, their need for quaternary care will go down.

So, instead of trying to catch the problem at the tail with a more sick patient, costlier treatment, and fewer hospital beds available which are not accessible to the patient, we should go ahead by investing more money in building a strong primary healthcare system. As a result, the strain on the medical system will be relieved, and we will be able to create a more productive population.

We would recommend a structured mechanism has to be found to be able to index it more towards primary healthcare, so that, our population can be healthier. It is very difficult for the private sector to participate meaningfully in a primary healthcare scenario. But, the government can make that investment. Finally, we believe that the electronic medical record is a game changer, and the more the government is able to incentivise electronic medical record adoption, we will be able to take the healthcare processes of our country to the next level.

Hospital CFOs voice ineligibility for Input Tax Credit in GST as a major concern

Healthcare needs to be made a priority sector

Sameer Agarwal, Group Chief Financial Officer, Manipal Health: Healthcare has been growing very well, and it has grown more than 15 per cent CAGR in the last five years. I don’t expect this to slow down in the foreseeable future, with at least a 15 per cent CAGR in the next five years. We are really hoping that the government continues to partner to nurture this sector, and as a prelude to that, the first step would be to make healthcare a priority sector. This has been a longstanding demand, especially from the hospital sector, to make healthcare a priority sector.”





Source link


Like it? Share with your friends!

0
Shafiq

0 Comments

Your email address will not be published. Required fields are marked *