GST: RECENT RELAXATIONS FOR HEALTH CARE

[Dr. Sanjiv Agarwal]

The 50^th meeting of GST Council which was held on 11.07.2023 took various steps and measures towards trade facilitation and streamlining the GST compliances which, inter alia, include few tax rate changes on goods and services and exemption from IGST on certain imported medicines for rare diseases.

Exemption on supply of health care related goods

GST Council took decisions to exempt the following goods from levy of Goods and Services Tax (IGST):

Goods	Type of Tax	Conditions
Dinutuximab (Quarziba) medicine	IGST	When imported, meant for personal use
Supply of medicine / Food for Special Medical Purposes (FSMP)	IGST	For use in treatment of rare diseases, (as per National Policy for Rare Diseases, 2021)
Food for Special Medical Purpose (FSMP)	IGST	When imported by centres of excellence for rare diseases or by any person / institution and recommended by any listed centre of excellence

The exemption shall come into effect only after Notification is issued by CBIC. No such Notification has been issued till 30^th July, 2023.

However, on the fillip side, it is argued that this relief may not be of much benefit to the patients as it may be very difficult to get a separate license to import a drug which is already registered in India. The waiver is extended only for specific drugs used for treatment of specified rare diseases with the condition that such drugs must be meant for personal use. The benefit need to be extended to drugs that are made commercially available in India.

For having a real impact of waiver, it should be extended to all rare disease products which are approved and available in our country and not by way of personal import only. With this, patients who are being treated on a locally available, approved product are deprived of the customs duty and GST waiver benefit. Only a handful of patients can afford to import such drugs on personal basis. The percentage of such people who can import these drugs is negligible as the drugs are exorbitantly priced.

Ideally, Government should consider extending the tax waiver benefit to all lifesaving medicines (including cancer medicines) that are imported and not just those for personal use so that patients in India can avail the duty waiver benefits and bring down their treatment cost.