GST cuts on cancer drugs, higher tobacco tax boosting public health: AIIMS study
New Delhi, Feb 5 (IANS/WISHAVWARTA) The Goods and Services Tax (GST) exemption of lifesaving cancer drugs and higher taxation on tobacco products are the steps aimed at strengthening public health in the country, according to a new study led by oncologists from the All India Institute of Medical Sciences.
The GST council, in its 56th meeting in September last year, recommended the total exemption of 33 lifesaving drugs, including those used in cancer care, from GST altogether (from 12 per cent to zero, and three critical drugs for rare diseases and cancer from 5 per cent to zero).
The study noted that the measures are making healthcare more affordable and accessible, reducing out-of-pocket expenses for patients.
Earlier this week, Union Finance Minister Nirmala Sitharaman slashed the basic custom duty on 17 cancer drugs in her Budget presentation.
“India’s recent GST reforms mark a significant step toward making cancer care more affordable and accessible. By exempting 33 life-saving cancer and rare-disease drugs from GST and reducing taxes on medical equipment, the government has directly eased the financial burden on patients and families,” Dr Abhishek Shankar, from the Department of Radiation Oncology at AIIMS, told IANS.
In another significant step, the GST council also increased the tax slab for tobacco products to 40 per cent, which is the highest for any class of goods in the country.
The benefits of such taxation, which became effective from February 1 this year, can lead to gains in life years, averting treatment costs and premature mortality as well as avoiding catastrophic expenditure on health and poverty, the study said.
Tobacco is also known as the leading preventable cause of cancer globally. A report by the World Health Organization (WHO) and its International Agency for Research on Cancer (IARC) on World Cancer Day stated that tobacco is responsible for 15 per cent of all new cancer cases.
“A higher taxation on tobacco products reinforces prevention by discouraging consumption and generating revenue that can be redirected toward public health,” Shankar said.
The study noted that the economic structural policy changes can also serve as guidance for other countries in the region with similar socio-economic and disease burden characteristics, which might benefit from adopting or adapting these measures in terms of policy layout, tax structure, and outcome monitoring.
“While timely pass-through of benefits to patients remains crucial, these reforms signal a balanced policy approach, one that supports treatment, promotes healthier behaviour, and strengthens India’s commitment to equitable cancer care,” Shankar said.
