GST & Indirect Tax

GST on Health Care, Diagnostics and Wellness Packages: Practical Case Study for Indian Users

📅 June 2026GST✔ cbic-gst.gov.in

Reviewed by CA Nikhil Gupta · Last reviewed 3 July 2026

Healthcare is broadly exempt from GST but the exemption covers only specific medical services by clinical establishments. Wellness centres, cosmetic treatments and health checkup packages can fall outside the exemption at 18%.

For broader context, see the GST Law & Practice Hub.

Healthcare GST Exemption: Scope and Limits

The rates below reflect the rationalised structure effective 22 September 2025 (56th GST Council meeting). Several wellness-category rates were cut sharply, while core clinical exemptions remain largely as before.

For the connected rule, example or next step, see GST Export of Services vs Intermediary Services: The Practical Difference.

Service	GST Status
Clinical establishment services (hospitals, clinics)	Exempt
Medical services by doctors and paramedics	Exempt
Diagnostic services (standalone labs)	Exempt
Ambulance services	Exempt
Hospital room accommodation (non-ICU) above the notified per-day threshold	Taxable at the applicable rate — the blanket clinical-establishment exemption doesn't automatically cover high-value room charges; ICU/critical-care rooms remain treated differently
Cosmetic surgery (non-medical necessity)	18% — taxable
Hair transplant, botox, fillers	18% — taxable
Wellness/spa/yoga/salon/gym/barber services (beauty and physical well-being services for the general public)	5% without ITC from 22 September 2025 (cut from 18%) — this is a mandatory rate, not optional
Preventive health checkup (clinical establishment)	Exempt

Telemedicine and Digital Health

Consultation by registered doctor via app/video = exempt healthcare service
Platform aggregator convenience fee = 18% taxable
Health insurance premium = exempt from GST

Case Study: Healzo Wellness Centre, Bengaluru

Monthly revenue: Rs.25L across service types (post-22 September 2025 rates)

Doctor consultations + diagnostics

Rs.12L — Exempt

Physiotherapy (post-surgery rehab)

Rs.5L — Exempt

Cosmetic treatments (botox, laser) — not medically necessary

Rs.6L × 18% = Rs.1.08L GST

Wellness spa + yoga (beauty/physical well-being)

Rs.2L × 5% (no ITC) = Rs.10,000 GST

Healzo must register for GST (taxable turnover roughly Rs.96L/year on the cosmetic and wellness segments combined). ITC is available on inputs for the cosmetic-treatment segment, which remains at 18% with normal ITC; the wellness/spa/yoga segment is now 5% without ITC, so input costs attributable to that segment are not creditable and Rule 42 apportionment governs shared inputs across exempt, 18%, and 5%-no-ITC activities.

FAQ

Is GST applicable on health insurance premium? +

It depends on the type of policy. From 22 September 2025 (Notification 16/2025-CT(R), implementing the 56th GST Council decision), premiums on individual health insurance policies — including family floater and senior citizen plans — and their reinsurance are fully exempt (Nil rate). However, group or corporate-sponsored health insurance (e.g., the policy an employer buys for its workforce) is NOT covered by this exemption and continues to attract 18% GST. So a company's group medical cover for employees remains taxable, even though an individual buying their own family floater plan now pays no GST.

Are Ayurveda and homeopathy treatments GST-exempt? +

Yes — if provided by a clinical establishment registered under the Clinical Establishments Act or equivalent state law, or by a practitioner registered under the Indian Medicine Central Council Act (AYUSH). Such services are exempt from GST.

Does a gym or fitness centre need to charge GST? +

Yes, but at a lower rate than before. Gyms, fitness centres, salons, barbers and yoga centres are not clinical establishments and don't qualify for the healthcare exemption, but their rate dropped from 18% to 5% without ITC effective 22 September 2025 as part of the GST Council's beauty and physical well-being services rate cut. This is a mandatory rate — providers cannot opt to charge 18% with ITC instead.

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Source and review trail

Use the current official instrument, portal or regulator publication before acting. This panel separates the category authority from page-specific references.

Primary category: GST & Indirect Tax
Official starting point: www.gst.gov.in

Page source links

Primary sources & related provisions

Statutory provisions referenced in this guide:

Rule 42 - CGST Rules, 2017