The federal government has proposed removing the sales tax exemption for charitable hospitals in the Finance Bill 2024-25.
Details reveal that the bill seeks to eliminate entry number 166 of the Sixth Schedule of S.T.A. 1990. Consequently, an 18 per cent sales tax will now be levied on supplies to the welfare healthcare sector.
This tax change affects charitable hospitals with at least 50 beds and welfare hospitals with 200 beds also used for teaching purposes, imposing an 18 per cent sales tax on their supplies.
As proposed in the Finance Bill 2024-25, an 18 per cent sales tax will be levied on a wide range of medical supplies and equipment, including essential items such as vaccines, testing kits, tubes, medical gloves, and masks. This tax rate will also extend to surgical instruments, operational equipment, and machinery parts used in charitable and welfare hospitals.
The imposition of this tax is expected to considerably raise the operational costs of healthcare services in Pakistan, affecting the affordability and accessibility of medical care in welfare-oriented hospitals.
