GST Reforms Make Cancer Care More Affordable

AIIMS researchers hail recent GST changes as a major step toward making cancer
treatment affordable for millions in India. These reforms slash taxes on life-saving drugs,
medical devices, and health insurance, directly tackling the crushing financial burden known as “financial toxicity” that often bankrupts families facing cancer. Dr. Abhishek Shankar and Dr. Vaibhav Sahni from AIIMS Delhi’s Radiation Oncology Department detailed this shift in a commentary published in Frontiers in Public Health, calling it a policy pivot toward equity in oncology care.
The GST Council’s 56th meeting approved exemptions for 33 critical life-saving drugs, reducing the rate from 12% to zero. This includes advanced cancer therapies like targeted immunotherapies and chemotherapies that were previously out of reach for many. Three drugs for rare diseases also dropped from 5% to nil GST. In a parallel move, health and life insurance premiums, vital for covering long-term cancer expenses, went from 18% GST to an exempt status. These changes aim to lower out-of-pocket costs, which currently consume up to 70% of a patient’s income in India.
Previously, imported cancer drugs and diagnostic equipment carried heavy taxes, inflating
prices by 20-30%. Now, with zero GST, manufacturers can pass on savings if input tax credits and refunds process swiftly. The reforms also hike GST on tobacco products,
generating extra revenue for cancer prevention campaigns, screening drives, and subsidies
under Ayushman Bharat PM-JAY. Researchers’ modeling predicts annual savings of
thousands of rupees per patient, potentially boosting treatment adherence and survival
rates. This builds on Union Budget 2026-27 measures, which exempted customs duties on 17 specific cancer drugs like trastuzumab and nivolumab. Together, these steps address India’s rising cancer burden, over 1.4 million new cases yearly, per ICMR data, with costs averaging ₹5-20 lakh per patient. Simplified taxation extends to devices like linear accelerators and PET-CT scanners, crucial for precise radiation and early detection. Challenges remain: ensuring pharma companies fully transmit benefits, streamlining refunds, and monitoring street prices. Without vigilant enforcement by the National Pharmaceutical Pricing Authority, gains could dilute. Still, experts see this as a blueprint for other chronic diseases. By prioritizing affordability, India advances toward Universal Health Coverage, aligning with Viksit Bharat goals by 2047. Patients in tier-2 cities stand to benefit most, as cheaper imports reach remote hospitals faster. Overall, these GST tweaks signal strong political will for compassionate, cost-effective healthcare.