GST cut on drugs, medical devices will provide relief to patients and their families, says healthcare industry

The healthcare industry has welcomed the government’s move to reduce GST on medicines and medical devices, calling it a progressive reform that will directly benefit patients by lowering treatment costs, improving affordability, and expanding access to essential medical technologies.

While healthcare services provided by doctors, hospitals, and diagnostic centres were already exempt under the GST regime, the government has announced a series of GST rationalisation measures to promote a health-positive tax regime, the Health Ministry said in a statement on Thursday (September 4, 2025).

“These reforms aim to lower the cost of medicines and medical devices, encourage preventive healthcare, and boost insurance coverage. The reforms strongly align with national initiatives such as Ayushman Bharat, Poshan Abhiyaan, and the Fit India Movement, while supporting the vision of ‘Affordable Healthcare for All’,” it added.

Welcoming the GST exemption on lifesaving and cancer medicines, the Indian Pharmaceutical Alliance said the move would bring direct relief to patients and their families. “The reduction in GST on a wide range of medicines from 12% to 5% will help ease the overall treatment burden and make essential therapies more affordable. These reforms will improve the accessibility of medicines and ensure wider availability across healthcare settings,’’ Sudarshan Jain, secretary general of the alliance, said.

Sanjiv Navangul, CEO, Bharat Serums and Vaccines, said the decision to eliminate GST on advanced therapies, particularly biologics for oncology and rare diseases, would immediately widen access and availability of advanced care into mainstream treatment pathways. “Such reforms reinforce India’s broader ambition of building a strong, self-reliant life sciences ecosystem that can deliver cutting-edge therapies at scale and at prices patients can afford,” he said.

The industry also welcomed the zero GST on individual health and life insurance policies, calling it a masterstroke. Shobana Kamineni, executive chairperson, Apollo Healthco, said the move made health protection a right, not a privilege. “Reductions on medicines and supplies bring affordable care to every household,’’ she said.

Anand Roy, CEO and managing director, Star Health and Allied Insurance, noted that the “reform will reshape the insurance landscape, accelerating penetration, driving higher renewal rates, building deeper customer loyalty and a critical catalyst for future growth”.

“This progressive reform will directly benefit patients by lowering treatment costs, improving affordability, and expanding access to essential medical technologies,’’ said Himanshu Baid, managing director, Poly Medicure Ltd., said.