Healthcare seeks priority status
The healthcare industry has sought ‘priority status’ in the forthcoming budget, so that it is able to buy land and gains access to funds at concessional rates, to bring healthcare facilities into the hinterland.business Updated: Feb 19, 2010 22:52 IST
The healthcare industry has sought ‘priority status’ in the forthcoming budget, so that it is able to buy land and gains access to funds at concessional rates, to bring healthcare facilities into the hinterland.
Prathap C Reddy, chairman of the Confederation of Indian Industries’ (CII) national committee for healthcare, has written to the Union Ggovernment pointing out that the government should also extend the tax holiday given to new hospitals from 5 years to 10 years, and for old ones that are upgrading their facilities, to seven years.
Other measures that he has recommended are assistance in procurement and leasing of land at concessional rates; tax-exemption healthcare institutions engaged in training and education in nursing, midwifery and paramedical courses; long-term debt finance from the Infrastucture Finance Company Ltd for large-scale healthcare projects; and creation of a health development fund.
“Tax abatement of 5 years given for building hospitals in tier-2 and -3 cities should be increased to a minimum 10 years, because hospitals take six to seven years to break even and promoters can not recover losses in 5 years,” Malvinder Singh, chairman, Fortis Healthcare told Hindustan Times.
Suneeta Reddy, Director Finance at Apollo Hospitals Enterprises feels that depreciation for medical equipment should be hiked from 15 to 25 per cent. She added: “Customs duty on medical and manufacturing equipment should be reduced to 5 per cent.”
Singh also demanded that Section 72 and Section 79 of the Income Tax Act should be amended to allow carry forward of losses and change of ownership when a merger or acquisition takes place.
Dr Pervez Ahmed, CEO & MD, Max Healthcare said, “The government expenditure on healthcare should be doubled to 2% of GDP with a focus on primary healthcare and public health in rural areas.”
Other demands made by the industry were to make it mandatory for companies to cover their employees through health insurance, promote doctors to serve in rural areas by exempting their earnings from income tax, and promote alternative streams such as ayurveda, unani and homeopathy by introducing 2-year courses post-MBBS.