Karnataka govt mulling withdrawal of luxury tax on ICU beds

Faced with a public outcry, Karnataka government is considering exemption of eight per cent luxury tax imposed on each bed in an Intensive Care Unit in hospitals.

“The government is considering exempting the luxury tax imposed on each bed in the ICU. The file will be moved and the Chief Minister will take a call on it,” a top official said.

Last week, the government had issued a directive to all hospitals in the city stating that eight per cent luxury tax will be levied on ICU charging more than Rs 1,000 per day per room (bed), triggering a public outcry against the move.

The medical fraternity argued that the tax will only add on to the burden of the patients, who get admitted in the ICUs of private hospitals for critical care services and not on account of luxuries.

ICU admissions are already quite expensive in private hospitals because the needs of ICU are higher in the sense of nurse-patient and doctor-patient ratios, the doctors argued.

A copy of the order was signed by the Commercial Tax Commissioner six months ago, but was strictly put into effect now.