Bowing to mounting pressure from industry captains, government may rollback decision to levy five

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per cent service tax on healthcare.

Business advisory committee of Lok Sabha that met on Tuesday set aside March 21 and 22 for consideration and passage of finance bill marking the completion of three-stage budget exercise in Lok Sabha.

Ahead of finance bill passage, finance minister Pranab Mukherjee is likely to make announcement on withdrawal of service tax on healthcare.Budget session of Parliament has been curtailed due to the forthcoming Assembly election in five states. Mukherjee has indicated there could be a special session of Parliament after the Assembly election to take up important economic legislations including constitutional amendment to ring in single impost, goods and services tax. Other important legislations like banking regulation act, pension and insurance reform bills may also be taken up during this session.

In the budget, Mukherjee had proposed five per cent service tax on health checkups and treatment in airconditioned hospitals.

Though service tax across sectors has been retained at 10 per cent, FM has provided 50 per cent abatement for healthcare services, thereby, making effective levy at five per cent. The announcement has drawn sharp criticism by not only hospital and healthcare professionals, but also industry chambers like Ficci and CII.

Chambers had appealed to Mukherjee to rollback service tax and accord infrastructure status to the healthcare sector.