Service tax has been imposed on cosmetic surgery and plastic surgery services by the Finance Act, 2009 with effect from 1st September, 2009 vide Notification No 26/2009-ST dated 19.8.2009. The gross amount charged by any person to any other person in relation cosmetic or plastic surgery is chargeable to service tax.
Meaning of cosmetic surgery or plastic surgery
The phrases 'cosmetic surgery or plastic surgery' has not been defined in the Finance Act, 1994 (as amended by the Finance Act 2009). Generally, such surgical procedures are undertaken to preserve on enhance physical appearance or beauty, the services which were hitherto excluded from beauty treatment services under section [65(105) (zq)].
Literally, 'cosmetic' implies involving or relating to treatment intended to restore or involve a person's appearance, an act deigned or serving to improve the appearance of the body, especially the face. It is an art of beautifying the body. It has its origin in 17th century from Greek where the word 'kos metikos' means arrange or adorn. The person who applies cosmetics is known as cosmetician .
According to Cambridge Advanced Learner's Dictionary, the term 'cosmetic surgery' has been defined as 'any medical operation which is intended to improve a person's appearance rather than their health'.
According to Wikipedia, the terms 'cosmetic surgery' is defined as 'a subspecialty of surgery that uniquely restricts itself to the enhancement of appearance through surgical and medical techniques. It is specifically concerned with maintaining normal appearance, restoring it, or enhancing it beyond the average level toward some aesthetic ideal'.
'Plastic Surgery' refers to the process of reconstructing or repairing parts of the body by the transfer of tissue, either in the treatment of injury or under medical exigencies or for cosmetic reasons. For the purpose of Service Tax, only cosmetic surgery is covered.
According to New Webster's Dictionary, the term 'plastic surgery' has been defined as 'the branch of surgery concerned with correcting disfigurements due to injury, age or congenital deformities, usually by transference of skin or bone'.
According to Cambridge Advanced Learner's Dictionary, the term 'plastic surgery' has been defined as 'a medical operation to bring a damaged area of skin, and sometimes bone, back to a usual appearance, or to improve a person's appearance'.
Surgery is that branch of medicine which is concerned with treatment of injuries or disorders of the body by incision or manipulation, especially with instruments. A person who practices surgery is known as surgeon. In common language, surgery is understood to be a medical terminology which is performed in a sterile environment and may be invasive or invasive.
According to Cambridge Advanced Learner's Dictionary, the term 'surgery' has been defined as 'the treatment of injuries or diseases in human beings or animals by cutting open the body and removing or repairing the damaged part'.
According to Wikipedia, the term 'surgery' is defined as a medical technology consisting of a physical intervention on tissues. As a general rule, a procedure is considered surgical when it involves cutting of a patient's tissues or closure of a previously sustained wounds.
According to the scope of taxable services only two types of surgeries are covered, i.e.-
· Cosmetic Surgery
· Plastic Surgery
but does not include medical surgery or cosmetic surgery which is performed for the purpose of medical treatment.
Types of Cosmetic / Plastic Surgery
Cosmetic or plastic surgery for the purpose of beautification may involve one or more of the following illustrative services-
Abdominplasty - 'Tummy tuck' is a cosmetic surgery procedure used to make the abdomen trim. It involves the removal of excess skin and fat from the middle and lower abdomen in order to tighten the muscle and fascia of the abdominal wall.
Bletheroplasty - A eyelid surgery which improves the appearance of the upper eyelid or both the eyelids.
Mammoplasty - It is a common surgical procedure to change the size of the breasts. It includes both, breast enlargement (breast augmentation) and decreasing the size of breast (breast reduction)
Lip augmentation -It consists of the enlargement and reshaping of otherwise normal lips to improve their dimensional relation with the nose, teeth and facial structures. Lip augmentation is cosmetic procedure designed to create fuller, smoother lips, and can also reduce fine lines around the mouth. Lip augmentation can be accomplished with the use of injectable fillers, implants, or through other surgical techniques.
Forehead lift -It is also referred to as brow lift which involves the cosmetic surgery of the part of the face above the eyebrows. A forehead lift is a cosmetic surgery procedure intended to improve a person's appearance by correcting the shape of the eyebrows and reducing horizontal wrinkles or furrows in the skin of the forehead.
Laser skin surfacing - It provides rejuvenation for skin that has been damaged by age or environmental stress. It is designed to improve overall appearance of the skin. It can treat fine lines, wrinkles and dis-coloration. Laser skin resurfacing involves the application of laser light to the skin in order to remove fine wrinkles and tighten the skin surface. It is most often used on the skin of the face.
Rhytidectomy - Also known as face lift, it is a cosmetic surgery to improve visible signs of aging in the face and neck.
Otoplasty -It is a cosmetic surgery to change the appearance of a person's external ears, a surgical operation to restore or enhance the appearance of an ear or the ears.
Rhinoplasty - A plastic surgery performed on the nose. It improves the appearance and proportion of nose, , enhancing facial harmony and self confidence.
Liposuction - Also known as 'lipoplasty, it slims and shapes specific areas of the body by removing excess fat deposits.
Brow lift - Also called an forehead lift, it minimizes the creases that develop across the forehead, or that occur high on the bridge of the nose and aims at improving what are commonly referred to frown lines.
Cheek augmentation - It is a cosmetic surgical procedure that in intended to emphasize the cheeks on a person's face. Similarly, chin augmentation may also be done.
Cosmetic dental surgery - It is a comprehensive oral case that combines art and science to optimally improve dental health, aesthetics and function.
Orthodontics -It is a specialty of dentistry that is concerned with the study and treatment of malocclusion (improper bites), which may be a result of tooth irregularity, dis- proportionate jaw relationship or both.
Aesthetic dentistry- Cosmetic dentistry includes a variety of dental treatments aimed at improving the appearance of the teeth. The purpose of cosmetic dentistry is to improve the appearance of the teeth. It includes following procedures-
Porcelain veneers - ceramic shells applied to the front of the teeth to conceal cracks, chips and gaps
Tooth colored filings
Porcelain in lays/on lays
In visalign - a cosmetic dentistry solution for unevenly spread, over lapping or gapped teeth.
Section 65(105) (zzzzk) defines taxable service as under -
Any service provided or to be provided to any person by any other person, in relation to cosmetic surgery or plastic surgery, but does not include any surgery undertaken to restore or reconstruct anatomy or functions of body affected due to congenital defects, developmental abnormalities, degenerative diseases, injury or trauma.
According to the aforesaid definition following tests should be satisfied to be a taxable service under section 65(105) (zzzzk) of Finance Act, 1994-
(a) Taxable service shall be provided by any person to other person.
(b) The services should be provided in relation to cosmetic surgery or plastic surgery.
The service should be in relation to cosmetic surgery or plastic surgery and other forms of surgeries including medical surgeries and operations are not covered in taxable service. It's not that only surgeries are taxable but services rendered in connection therewith are also taxable . These services could be performed by any person who may or may not be a qualified surgeon. For example, beautician can also perform such surgical procedures not involving medical procedures.
Taxable service shall, however, exclude the following surgeries-
(a) surgery undertaken to restore on reconstruct anatomy or functions of body affected due to congenital defects, developmental abnormalities, degenerative diseases, injury or trauma.
(b) medical surgeries to cure any illness or disease or under medical exigency.
(c) surgeries undertaken to correct any impairment in body.
(d) Beauty treatment service and beauty parlour service as defined in section 65(17) and 65(105) (zq).
Ministry of Finance vide Letter No DOF No 334/13/2009-TRU dated 6-7-2009 has clarified on this service as follows-
Cosmetic and Plastic Surgery service:
Beauty treatment service provided by saloons, beauty parlors and beauticians are taxable since 2002. The service now proposed to be taxed is cosmetic surgery and plastic surgery undertaken to preserve or enhance physical appearance or beauty. As per common definition, surgery is a medical technology consisting of a physical intervention on tissues. As a general rule, a procedure is considered surgical when it involves cutting of a patient's tissues or closure of a previously sustained wound. Commonly surgery is performed in a sterile environment with anesthesia and antiseptic conditions using surgical instruments. It also includes 'non-invasive' surgery.
Some of the commonly known aesthetic/cosmetic surgeries are abdominoplasty (tummy tuck); letharoplasty (eyelid surgery); mammoplasty; buttock augmentation and lift; rhinoplasty (reshaping of nose); otoplasty (ear surgery); Rhytidectomy (face lift); liposuction (removal of fat from the body); brow lift; cheek augmentation; facial implants; lip augmentation; forehead lift; cosmetic dental surgery; orthodontics; aesthetic dentistry; laser skin surfacing etc.
However, any reconstructive surgery undertaken to restore one's appearance, anatomy or bodily functions affected due to congenital defects, developmental abnormalities, degenerative diseases, injury or trauma would be outside the scope of this service. These processes could be undertaken to correct impairment caused by burns, fractures or congenital abnormalities like cleft lip etc.
Reconstructive surgeries may be for feet care, wound care, micro surgeries etc. The non surgical treatments would cover laser treatment, botox injections, chemical peal, micro dermabrasion, sclerotherepy etc. The services of dermatologists or skin specialists such as facial hair removal, removal of warts, tags, moles, skin diseases etc. are also not considered as surgical procedures.
In deciding the taxability , it should be kept in mind as to what is the purpose of surgery? If it is a medical requirement, no service tax is levied. If it has only a beautification or appearance value, service tax should be levied. The dominant intention should decide the taxability aspect of cosmetic or plastic surgery.
Any person providing taxable service in relation to cosmetic surgery or plastic surgery shall be person liable and treated as an assessee for service tax purposes.
Inclusions and Exclusions
An illustrative list of inclusions and exclusion from taxable service is as follows -
Cosmetic surgery/ plastic surgery to preserve or enhance appearance/ beauty: surgeries such as abdominoplasty (tummy tuck); letharoplasty (eyelid surgery); mammoplasty; buttock augmentation and lift; rhinoplasty (reshaping of nose); otoplasty (ear surgery); Rhytidectomy (face lift); liposuction (removal of fat from the body); brow lift; cheek augmentation; facial implants; lip augmentation; forehead lift; cosmetic dental surgery; orthodontics; aesthetic dentistry; laser skin surfacing etc.
Beauty treatment services, health club services, reconstructive surgery to restore bodily functions affected due to congenital defects, development abnormities diseases, injury, trauma etc.