5-yr tax breather for hospitals
Rashtriya Swasthya Bima Yojana will provide a health cover of Rs 30,000 for every worker in the unorganised sector and his/her family would provide the link with hospitals from the other side.india Updated: Mar 01, 2008 02:44 IST
Kapil Vaish, a chartered accountant in Bareilly feels that hospitals in his city will get a much needed breather with the budget announcing tax holiday for hospitals set up in tier-II and tier-III cities. He feels that people who flock to Bareilly from neighbouring places would come down.
It will now be cheaper and easier to get well in India’s smaller towns. Patients in these, as well as the rural areas, will reap major benefits from budget announcements on healthcare.
More hospitals mean less travel to the nearest one and less crowded wards. The Rashtriya Swasthya Bima Yojana that will provide a health cover of Rs 30,000 for every worker in the unorganised sector falling under the BPL category and his/her family would provide the link with hospitals from the other side, said Habil Khorakiwala, chairman, Wockhardt.
The anti-AIDS drug, Atazanavir, as well as bulk drugs for its manufacture would be totally exempt from excise duty. This is expected to bring the prices down even further. AIDS drugs are available at less than Rs 40 a dose, thanks to companies such as Cipla.
Customs duty would be reduced on life saving drugs that are now imported. These, and drugs made in India would be totally exempt excise or countervailing duty.
Giving in to a long-standing demand of drug companies, excise duty on all goods produced in the pharmaceutical sector from 16 per cent to 8 per cent.
“The excise duty cut will help smaller pharmaceutical companies clamber back on track,” said Swati Piramal, director, Nicholas Piramal India Ltd.
“The reduction in excise duty and the additional reduction on all pharma products bring in parity between regions entitled to exemptions and otherwise,” said Kamal Sharma, MD, Lupin, one of India’s largest drug companies.
The Indian healthcare delivery sector, comprising mostly hospitals, clinics and nursing homes, is projected to grow to nearly US$ 40 billion by 2012, says PricewaterhouseCoopers in its report, Healthcare in India: Emerging market report 2007.
The sector's growth will be driven by the country's growing middle class, which can afford to pay for quality healthcare. Over 15 crore Indians have annual incomes of more than Rs 40,000 (US $ 1,000), and many who work in the business services sector earn as much as Rs (8 lakh) US$ 20,000 a year. Today at least 5 crore Indians can afford to buy Western medicines-a market only 20 per cent smaller than that of the UK.