In a landmark decision, the GST Council has slashed tax rates across multiple categories, but the biggest relief comes for patients battling chronic illnesses. Effective September 22, all 33 life-saving drugs will now attract 0% GST, bringing essential treatments within closer reach for millions of families. Additionally, GST on three critical cancer and rare-disease medicines has been cut from 5% to nil.
Making Healthcare Affordable
Finance Minister Nirmala Sitharaman announced that all individual health and life insurance policies—whether term, ULIP, endowment, or family floater—are now exempt from GST. This move, she said, will make insurance affordable and expand coverage, especially for middle-class families and senior citizens. Medical apparatus and devices, including surgical and dental equipment, also saw GST rates slashed from 18% to 5%.
Other Essential Reductions
While the healthcare sector received the most attention, GST on all other medicines was reduced from 12% to 5%, further easing household expenses. Everyday essentials such as milk, paneer, Indian breads, namkeen, noodles, chocolates, sauces, and coffee now attract only 5% or nil GST, lowering grocery bills. Agricultural equipment—vital to farmers—will also be taxed at 5%, down from 12%.
Towards a Simplified GST
The Council approved a rationalised structure, scrapping the 12% and 28% slabs, leaving just two: 5% and 18%. Items such as small cars, motorcycles, dishwashers, and televisions above 32 inches moved to 18% from 28%. Officials estimate the reforms will cost ₹48,000 crore in revenue, but described it as fiscally sustainable and pro-people.
A Strong Welfare Signal
By prioritising healthcare, insurance, agriculture, and household goods, the government has sent a clear signal: GST 2.0 is designed for the common man. For patients struggling with high treatment costs, the 0% GST on life-saving drugs marks one of the most impactful reforms yet.
