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The Goods and Services Tax (GST) has drastically changed India’s taxation system while aiming to simplify the process and encourage compliances. However, the impact of the same on the healthcare sector reveals challenges that require immediate attention. Despite healthcare services being largely exempt from GST, healthcare providers face mounting operational costs due to the embedded nature of taxes and limited availability of input tax credit in this respect. Rationalising GST rates across the sector therefore is essential to address these issues and ensure affordability while fostering sectoral growth. One of the primary challenges concerning the healthcare sector today is the embedded tax on input goods and services as part of GST, which disproportionately affects the healthcare providers in the country. As per a study conducted by global consultant EY, hospitals incur embedded taxes amounting to as much as 6 percent of their turnover, significantly higher than the 4.3 percent pre-GST burden. This increase stems from the inability to claim tax credits on essentials like medical equipment(s), medical devices as well diagnostic tools which are taxed at rates of 12% to 18%, a cost that hospitals must either absorb or pass on to their patients. Source - Cnbctv18 #HealthcareIndia #GSTReforms #HealthyIndia #EconomicGrowth #AffordableHealthcare