Waiver of GST on Medical Consumables for Kidney Dialysis

Date: 21 October 2013

Parliamentary Question by Mr  David  Ong  Kim  Huat:

To  ask  the  Deputy  Prime  Minister  and Minister for Finance whether the Ministry will consider extending the waiver of GST on medical consumables for kidney dialysis to all patients instead of just those receiving treatment at Government-related organisations  in view  of the fact  that  many of  those  needing dialysis choose private dialysis not by choice but because of  inadequate space or inability to meet certain conditions of VWO-run centres.

Reply by DPM and Finance Minister Tharman Shanmugaratnam:

We have a broad-based GST system, with minimal exemptions. We have chosen this approach so as to keep the GST rate relatively low, rather than have many exemptions and a higher GST rate. With this broad-based GST, our approach to helping the lower income group is to do so through subsidies and grants that are targeted at benefiting them.

The Government provides means-tested government subsidies, including an absorption of the GST payable, to lower- and middle-income dialysis patients in Government-funded dialysis centres which are run by Voluntary Welfare Organisations (VWOs). This approach is aligned to the treatment in other parts of the healthcare system such as the intermediate and long-term care sector where GST absorption is only provided to subsidised patients.

To ensure that dialysis treatment remains affordable for Singaporeans, the Government had recently extended these subsidies from the 30th percentile to the 67th percentile of households in April 2013. This has increased the number of dialysis patients receiving subsidies and GST absorption by around 40%.

There is generally adequate capacity within Government-funded VWO dialysis centres for subsidised dialysis patients, which already serve around two-thirds of the patient population today. However, we recognise that there could be certain regions where demand is higher, and will continue to work with Government-funded VWO dialysis centres to ensure that there is sufficient capacity to serve the subsidised dialysis population in these areas.

We acknowledge that there could be dialysis patients who are unable to seek treatment at these dialysis centres due to their specific medical conditions. Our VWO dialysis providers will nonetheless provide financial assistance to such patients where necessary.