Kolkata May 24 (IANS) The medical device industry expects the tax load in the Goods and Services Tax (GST) regime to increase which will result in a higher cost burden on patients an official said on Wednesday.
The medical device sector can expect a higher tax burden due to the proposed GST rates subsequently resulting in a higher cost burden to the patients said Medical Technology Association of India s (MTaI) Board Member Sanjay Bhutani.
He said at the existing indirect tax regime the embedded tax rate approximately comes to 7.5 per cent and 10.7 per cent after considering countervailing duty central sales tax value added tax (VAT) Octroi entry tax etc.
In the GST regime the rate was pegged at 12 per cent.
The medical devices including surgical instruments therefore will roughly have an additional tax burden of 4.5 per cent to 1.3 per cent he said.
Countervailing duty is levied at the first point that is at the import price while central sales tax is imposed on the billing price from the company to the distributor. VAT is levied at the value at which the goods are finally sold to customers.
According to Bhutani it was earlier expected that the tax burden would ease with the introduction of GST as the uniform indirect tax regime would subsume all the taxes.
--IANS
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Tax burden likely to increase on medical device in GST regime
