No hike in medical bill as Govt withdraws health service tax

New Delhi : There is some relief for the common man as Finance Minister Pranab Mukherjee on Tuesday announced in Parliament the withdrawal of the newly levied service tax on healthcare.

'The Indian Express' had reported March 18 that the government would roll back some of its tax proposals, including service tax on healthcare services.

Finance Minister Pranab Mukherjee had in Budget 2011-12 proposed extending service tax on diagnostic tests and medical services provided by a centrally air-conditioned hospital that has 25 beds or more. He, however, allowed a 50 per cent abatement, so that the tax rate would work out to 5 per cent.

While the rationale was to complete the tax credit chain, it came in for public and industry criticism. Significantly, the National Human Rights Commission also expressed its disapproval.

The Finance Ministry is also planning to provide some relief to garment manufacturers hit with a 10 per cent excise levy. This could either be lowered, said sources, or set off against the Central excise duty paid.

http://www.indianexpress.com/news/no-hike-in-medical-bill-as-govt-withdraws-health-tax/765757/