NewDelhi, sept 04 : In a landmark decision aimed at improving healthcare accessibility and affordability, the Union government has eliminated the Goods and Services Tax (GST) on 33 cancer and rare disease drugs, reducing the rate from 12% to 0%. This major tax relief comes as part of a broader overhaul of the GST structure by the GST Council, chaired by Finance Minister Nirmala Sitharaman. The Council has also rationalized the overall GST system by scrapping the 12% and 28% slabs, retaining only the 5% and 18% categories. This move is expected to provide significant relief to patients and families dealing with high medical costs. The revised GST rates will benefit not only cancer patients but also those suffering from severe chronic and rare diseases. Life-saving drugs, essential medical devices, and diagnostic kits will now attract either 0% or 5% GST instead of the earlier 12% or 18%. Spectacles and vision-correcting goggles, previously taxed at a hefty 28%, will now fall under the 5% bracket. These tax reductions are poised to reduce out-of-pocket healthcare expenses for millions of Indians, offering a much-needed financial cushion. Further expanding on public health initiatives, the government has also slashed GST on individual health and life insurance premiums from 18% to zero. The Finance Minister emphasized that this change will make insurance policies more accessible to the common man and help expand insurance coverage nationwide. Additionally, medical oxygen, surgical equipment, and diagnostic devices like glucometers and reagents will now attract only 5% GST, making vital healthcare services more affordable across the board. In contrast, the GST Council maintained high tax rates on products harmful to public health such as pan masala, gutkha, cigarettes, and tobacco products. These items will continue to be taxed at existing high GST rates and compensation cess levels until outstanding cess-linked loans are paid off. Moreover, all sugar-sweetened beverages and aerated drinks will now attract a steep 40% GST, up from 28%, to discourage their consumption. This dual approach reflects the government’s intent to prioritize health while discouraging unhealthy lifestyle choices.
