Service tax on medical sector

Hospitals & Health Services under Service Tax:

 (K.RAJA TAX CONSULTANT, TIRUCHENGODE)

Notification No:25/2012 dated 20.06.2012

Health care Services by a clinical establishment an authorized medical practitioner or Para-medics are exempt quoted Sl.No 2 in the above Notification effect from 01.07.2012.  For your retain information see briefly:-

“Clinical establishment “means a hospital, nursing home, clinic, sanatorium or any other institution by, whatever name called that offers services or facilities requiring diagnosis or treatment or care for illness, injury, deformity, abnormality or pregnancy in any recognized system of medicines in India or a place established as an independent entity or a part of an establishment to carry out diagnostic or investigative services of diseases.

“ Health care services “ means any service by way of diagnosis or treatment or care for illness, injury, deformity, abnormality or pregnancy in any recognized system of medicines in India and includes services by way transportation of the patient to and from a clinical establishment, but does not include hair transplant or cosmetic or plastic surgery, except when undertaken to restore or to reconstruct anatomy or function of body affected due to congenital defects, developmental abnormalities, injury or trauma.

 “Authorised medical practitioner “means a medical registered practitioner with any of the councils of the recognized system of medicines established or recognized by law in India and includes a medical professional having the requisite qualification to practice in any recognized system of medicines in India as per any law for the time being in force.  

Paramedic are trained health care professionals for example nursing staff, physiotherapists, technicians, lab assistants etc., Services by them in a clinical establishment would be in the capacity of employee and not provided in independent capacity and will thus be considered as services by such clinical establishment and similar services in independent capacity are also exempted  - refer Para 7.2.2 of CBEC’s Educational Guide on 20.06.2012.

Veterinary Services “Services by a veterinary clinic in relation to health care of animals or birds are exempted vide serial no. 3 of the Notification No. 25/2012 dated 20.06.2012 effective from 01.07.2012.

One more important service of Ambulance service also exempted - see definition clause 2(t) of the above Notification No. 25/2012 dated 20.06.2012

Technical testing of new drugs  Service by the way of technical testing or analysis of newly developed drugs, including vaccines and herbal remedies, on human participants by a clinical trials by the Drug Controller General of India are exempt – serial no. 7 of the above Notification No. 25/2012 dated 20.06.2012