Financial Daily from THE HINDU group of publications
Wednesday, Feb 08, 2006


Group Sites

Home Page - Taxation
Industry & Economy - Health

Finance Ministry not for levying health cess

Nithya Subramanian

New Delhi , Feb. 7

THE Finance Ministry is not in favour of levying an additional 2 per cent cess as proposed in the draft Pharmaceutical Policy to fund the healthcare needs of the poor in the country.

At a high-level meeting chaired by the Cabinet Secretary, Mr B.K. Chaturvedi, officials from North Block were of the view that levying another cess would not go down well as the tax payer is already being burdened with a 2 per cent education cess, a road cess, tobacco cess among others.

According to highly placed sources, besides Budgetary support, the Finance Ministry is keen that alternate funding mechanisms be examined. "The Health Ministry has been asked to look into the issue and come up with suggestions," said sources.

The Health Ministry had also supported the proposal for levying a health cess put forward by the Department of Chemicals and Petrochemicals.

The draft Pharma Policy has said that Rs 6,500 crore would be required to fund various schemes and "in case there is difficulty in levying of health cess, the Government may provide funds amounting to Rs 6,500 crore which is equivalent to 0.02 per cent of the GDP out of the general Budget."

Currently only 0.9 per cent of GDP is being spent on health and as per the National Common Minimum Programme this would have to be raised to 2 to 3 per cent of GDP.

It had said that the money would be spent primarily on schemes meant for the poor people and would be used to fund supply of medicines through the Rashtriya Swasthya Bima Yojana, to fund the subsidy scheme for anti-cancer drugs, to expand the anti-retroviral treatment centres for additional AIDS patients throughout the country among others.

Meanwhile, a section of the industry under the Indian Pharmaceutical Alliance has said that the funds raised should be used for creating infrastructure instead of spending on consumption.

It has recommended setting up more AIIMS like institutions in each State, establishing cancer treatment centres in each district, strengthening the primary healthy centres and putting in place more institutions like the National Institute of Pharmaceutical Education and Research.

More Stories on : Taxation | Health

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Reliance hands over control of 4 demerged cos to Anil Ambani

Maxis Comm plans fresh investment of $1 b in India
Cos may adopt new accounting norms from April — Govt to accept NACAS recommendations in toto
Homegrown cos offer better salary hikes than MNCs: Survey
CSO pegs growth at 8.1 pc — Estimates surpass expectations of RBI, Finance Minister
Nasscom ropes in Booz Allen to study engg services space
From 5k to 10k...
Top 4 stocks retain weightage in Sensex

Finance Ministry not for levying health cess
Google sets up sales, marketing offices in Delhi, Mumbai
Sensex crosses 10k on strong fund flows
IOB board to meet on Feb 14 on buying out Bharat Overseas

The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription
Group Sites: The Hindu | Business Line | Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |

Copyright 2006, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line