The CDSCO (Central Drugs Standard Control Organization) under the Ministry of Health and Welfare has issued a directive to the licensing authorities of all states and union territories regarding the new GST that will be levied on medicines, medical devices and many other medical products.

The directive aims to create mass awareness among the public, stakeholders, and industries about the new GST rate structure announced by the Government of India. The new Next-Gen GST Reforms 2025 came into effect on September 22, 2025, introducing a rationalised tax structure to make healthcare and essential medical products more affordable for citizens.

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Purpose of the Circular

The circular has been issued so that all the States and Union Territories can participate in the 100-day GST awareness campaign launched by the Indian government. This campaign has been launched so that everyone can know about the reduced GST rates on medicines, medical devices and items in the healthcare sector.

The main purpose is to ensure that everyone can benefit from low tax rates and make them accessible to all. This reform plays an important role in the healthcare sector and will make affordable medicines and healthcare items available across the country. It reduces the cost of treatment for chronic diseases and helps make essential medicines accessible to every citizen.

Instructions to States and UT Licensing Authorities

The CDSCO circular outlines specific instructions for all State and Union Territory Licensing Authorities to promote the GST rationalisation campaign effectively:

• Display banners and posters related to GST reduction in offices of the state and UT drug control departments.
• Encourage manufacturers, wholesalers, and retailers to promote GST awareness by displaying posters and banners in their premises.
• Disseminate campaign messages through pharmaceutical associations and medical industry networks.
• Share photographs and reports of the actions taken with CDSCO Headquarters for record and progress tracking.
• Continue the awareness campaign consistently for 100 days to ensure maximum public reach.

Highlights of the Revised GST Rates

The Next-Gen GST Reforms reduce tax rates across several categories of healthcare goods and services which includes the medicines and medical devices too. The revision also extends to wellness, diagnostics, and health-related products.

These rate cuts aim to reduce treatment expenses and promote healthcare affordability throughout the country.

Impact of GST Rationalisation on the Healthcare Sector

The effect of GST rationalisation on the Healthcare Sector is:

1. Affordable Medicines: Lower GST on essential and chronic disease medicines will make treatments more cost-effective for patients suffering from diabetes, hypertension, and cancer.
2. Encouragement to Domestic Manufacturing: The reduced GST on job-work and raw materials in the pharmaceutical sector supports “Make in India,” boosting local production and innovation.
3. Affordable Medical Devices: Devices such as oxygen concentrators, ventilators, diagnostic kits, and hospital equipment will now cost less, helping hospitals and clinics reduce operational costs.
4. Lower Burden on Patients: The rationalisation directly reduces treatment expenses for patients across income groups, supporting the goal of “Health for All.”
5. Support to Preventive Healthcare: GST cuts on wellness and fitness services, like gyms and fitness centres, promote preventive health practices among citizens.
6. Enhanced Access to Vision Care: GST reduction things related to eyes especially on spectacles, contact lenses, and optical products ensures affordable vision correction and eye care.

Awareness Campaign Under MoHFW

The Ministry of Health and Family Welfare (MoHFW), along with CDSCO, has developed a structured awareness campaign under the theme "Next-Gen GST Reforms: Affordable Healthcare for All." The campaign includes:

1. Use of social media hashtags and creative posts shared through official accounts on social media.
2. Public banners, posters, and digital displays at hospitals, drug control offices, and pharmaceutical outlets.
3. Community outreach activities coordinated with state drug control authorities.

These initiatives are designed to inform both healthcare professionals and the public about the new GST rates and their benefits.

Also Read: Next-Gen GST Reforms: A Key Initiative for Pharma, MedTech and Cosmetics Industry Associations

Significance of the 2025 GST Reform

The New GST reform reflects the government’s commitment to good and affordable healthcare access. By decreasing the taxes on drugs and medical essentials, the policy benefits everyone in the country. It also simplifies the taxation system for the pharmaceutical and medical device industry, ensuring transparency and uniformity across states and UTs.

The initiative encourages both manufacturers and distributors to pass on the price benefits to consumers. Moreover, this reform strengthens the public-private collaboration in health sector growth while aligning with India’s National Health Policy goals.

Monitoring and Reporting

All State and UT Licensing Authorities must actively participate and monitor the awareness drive. The CDSCO Headquarters will receive and compile activity reports, ensuring that the campaign achieves full coverage and public awareness within the 100 days. The cooperation of every authority and industry body is vital to ensure that the benefits of GST rationalisation reach every citizen, especially those dependent on essential medicines and medical devices.

Conclusion

The Next-Gen GST Reforms 2025 is an important change taken in the India’s healthcare journey. By decreasing taxes on medicines, medical devices, and essential healthcare services in India, the government has strengthened the core for affordable and accessible treatment by keeping each and every person in mind.

Through coordinated efforts between CDSCO, State and UT Licensing Authorities, and the pharmaceutical industry, the awareness campaign will ensure that every citizen understands the benefits of the new GST structure.

The reform not only supports patients but also boosts healthcare manufacturing, distribution, and service affordability, moving India closer to the goal of “Health for All, Savings for All.”