New Sales Tax on Medical Devices to Increase Healthcare Costs by Up to 30%

The federal government has imposed a sales tax on over 200 medical devices, including essential equipment for procedures like angiography and angioplasty, and diagnostic kits for various diseases.

This measure, part of the 2024-25 fiscal budget, is expected to significantly impact healthcare affordability, particularly for poorer patients.

Experts warn that this first-ever sales tax on diagnostic and treatment equipment will increase healthcare costs by 25% to 30%. Public hospitals will face higher budgets, likely reducing routine operations, angiographies, and angioplasties. Private hospital patients from poor and middle-class backgrounds will also bear the brunt of the increased costs.

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Masood Ahmed, Chairman of the Healthcare Devices Association of Pakistan, highlighted that the federal government has applied this tax to all imported medical devices and diagnostic kits. The association has appealed to the Prime Minister and Finance Minister to remove the tax, warning that it will make medical treatment unaffordable for the poor.

Dr. Syed Junaid Ali Shah, former provincial health minister and President of the Private Hospitals and Clinics Association, stated that the 15% sales tax on diagnostic kits would heavily burden patients, particularly the poor. In an emergency meeting, the association demanded that healthcare providers be granted industry status, emphasizing that healthcare is a necessity, not a luxury.

Additionally, the Sindh government has introduced a 15% tax on medical services, further increasing the financial burden on patients who predominantly rely on private healthcare providers.