Anticipating the Finance Budget 2024, OMNI Hospitals emphasizes key areas for consideration. According to the recent amendment in the Finance Act 2023, the insertion of clause (h) in Section 43B of the Income Tax Act raises concerns for the healthcare sector. Effective from Assessment Year 2024-25, any payment delay to micro or small enterprises under the MSMED Act may pose cash flow challenges for hospitals. We expect an exemption for hospitals engaged in the credit business and those registered under MSME.
Additionally, we hope the Budget classifies healthcare projects as ‘Infrastructure’ to enable access to long-term funds at a lower cost. Inclusion in priority sector lending (PSL) classification would further support the growth of the healthcare sector.
Tax relief is crucial for strengthening healthcare infrastructure. Consideration for tax incentives, including a tax holiday for both existing and new healthcare projects, can significantly contribute to this objective.
Rationalizing the GST law for healthcare is imperative. Standardizing GST at 5% or a lower rate on all services would simplify input tax credit claims and streamline the cost of providing healthcare services.
Lastly, addressing concerns related to insurance claim settlements is vital. Introducing provisions similar to Section 43B (h) for MSMEs, including penalties for undue settlements by insurance companies and establishing an Ombudsman under IRDA, would safeguard the interests of healthcare service providers.”
