GST - Confusion in Healthcare?

Malaysians who primarily use public health services need not worry as these are not subjected to  tax at all ie totally exempted from the Goods and Services Tax (GST)

However, those using private healthcare facilities, including purchasing their own medicines from retail pharmacies, will be subjected to 6% GST

The many different categories and methods of taxing private healthcare services and products under the GST regime is confusing to most patients seeking private healthcare.

Medicines alone fall under all three categories of GST, depending on the type of medicine and place of purchase.

4,215 medicine brands have been listed by the Customs Department as zero-rated, meaning 0% tax is charged on them. These will be identified by a “Z” at the back of their registration number, which begins with “MAL”, followed by an eight-digit number.

Medicines are exempted from GST when prescribed by a private doctor and bought from a hospital’s own pharmacy or the doctor’s private practice. However medicines bought at private retail pharmacies are subjected to the 6% tax.

Doctors who consult at private hospitals or clinics will have to charge 6% GST on their fees if they are not employed by the hospital or clinic, and earn more than RM500,000 a year.

Federation of Private Medical Practitioners’ Associations, Malay­sia (FPMPAM) president Dr Steven Chow said: “Consultants are required to invoice and itemise the 6% GST in their bills. The doctors are then required to submit this invoice to the hospital, which acts as the conduit for collection of their fees and GST."

“However, the hospital – with the provision of healthcare services having been designated as ‘exempted’ – is not allowed by law to have the item ‘GST’ itemised in their final invoice to the patient.”

In a letter to The Star from Association of Specialists in Private Medical Practice president Dr Sng Kim Hock said a circular from the Customs Department suggested that the bill should state “GST inclusive”, rather than “GST tax”.

The GST status of medical devices is yet to be decided, with the Customs Department currently working on a list that will be given the “exempt” status.

Customs GST division senior assistant director II Norazura Hashim has said that it was not wrong for doctors to increase their charges to cover the GST taxes as they would have to pay that could not be passed on to the patient directly as GST.

 /theSTAR 29-03-2015

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