GST impact on Medical device industry, patients may have to bear higher costs: MTAI

New Delhi, May 25 (KNN) With the GST rates finalised at the last GST council meeting in Srinagar, there is fear among the medical device manufactures that the tax rates for the medical devices under the upcoming GST will result in price rise.

In a press interview Board Member of Medical Technology Association of India (MTaI) Sanjay Bhutani said that the tax load in the GST regime will increase. This will have implications on the cost of availing medical facilities by the patients.

Explaining further he said that under the present taxation policy, the tax that is levied on the industry costs around 7.5 per cent. When other elements such as countervailing duty, central sales tax, value added tax and entry tax is added it ranges not more than 10.7 per cent.

Whereas under the GST, the proposed rate is as high as 12 per cent which means that the manufacturers will have an increased cost of manufacturing. The medical devices such as surgical instruments will attract an additional burden at least 1.3 per cent to 4.5 per cent.

While the industry welcomes the new taxation policy, it was expecting that the tax burden will be eased up asunder the GST, the cascading effect of taxation will get eliminated.

The concern comes in the backdrop of the statement made by the finance ministry earlier this week. It said in a statement that under the GST, there will be a lower tax burden on several commodities including medicaments and medical devices. (KNN/ DA)