KOCHI: The Kerala High Court on Friday upheld the government decision to levy luxury tax on hospital rooms that cost more than Rs 1,000 per day. The activity which is intended to provide comfort and pleasure beyond the requirements of the constitutive facilities of a hospital would then satisfy the definition of ‘luxury’ laid down by the Supreme Court, the court held. The order was issued on a set of appeals filed by hospitals providing allopathic and ayurvedic treatments.
The state government had incorporated amendments in the Kerala Tax on Luxuries Act, 1976 making it mandatory for hospital having not less than five rooms for accommodation of patients and which charge Rs 1,000 and above per room, excluding the charges for medicine, food and professional services.
The wisdom of legislature has to be respected as being for the good of the citizenry at large and not to the sentiments of a few, the court observed and held that the amendments to the Act have been enacted by the legislature within its competence and therefore, is intra-vires of the Constitution of India.
While the primary business of the hospitals is still healing, accommodation has become much more comfortable nowadays. It is recognised by the doctors and healers that the ambience and surroundings of the hospitals, especially the accommodation provided to the patients would impact recovery and contribute to the recuperative process. Many hospitals have much better infrastructure. Furniture and interiors have been spruced up to give the patients and bystanders all the comforts and luxuries as possible, the court observed.
The focus of hospitality in hospital is more on the interior design, trained staff and facilities like televisions and inter connectivity and the patients are willing to pay for it. The harbinger of these changes was the advent of what is called medical/ hospital tourism.
The court pointed out that the attempt by the Legislature was not to tax the fundamental and inherent services of a hospital like food, medicine and professional charges, but the luxurious accommodation facilities, and that too, above Rs 1,000 per day. These amenities and facilities are not intended for recovery, healing or treatment of the patients but are obviously intended for better comfort and pleasure for both the patient and bystander.