GST on disability services: A barrier to inclusion, India Autism Centre report says
Kolkata: A white paper released by the India Autism Centre (IAC) has recommended exempting disability support services such as therapy, rehabilitation, and community-based care from the Goods and Services Tax (GST). The report argues that taxing these services creates structural barriers to accessing care and places a long-term financial burden on families.
The first chapter of the report, titled 'Financial Sector Reforms to Empower Persons with Disabilities', proposes a 0% GST rate on all disability support services. It says the current tax framework does not recognise the multidisciplinary nature of disability care. While exemptions exist for healthcare, education, and certain charitable activities, many non-profit disability service providers fall outside these categories, leaving essential services taxable.
Sreerupa Chakraborty, Strategy Lead at IAC and co-author of the white paper, said: "Autism and disability are lifelong conditions. You need lifelong care, therapy, support, and more. One parent generally has to quit their job and look after the child if they cannot afford additional help. This increases the cost of living to take care of the child, but one person's income stops. There are organisations like us who can offer this ecosystem to families so they get the support they need, but we are being charged GST if the person with disability is not at the extreme end of the spectrum. There is a gap between law and implementation."
The report describes the current GST framework as a structural barrier to accessing essential disability support services. It notes that services such as therapy, rehabilitation, education, and community-based support are often subject to GST despite being essential.
Nipun Malhotra, Strategic Lead for Advocacy and Partnerships at IAC and founder of the Nipman Foundation, said disability cannot be treated as the responsibility of a single department. "Disability is an intersectional issue. No one Ministry can be blamed. Whether it is housing laws, technology regulations or fire safety norms, the question should always be: Are people with disabilities being considered when policies across different sectors are framed?" he said.
The report argues that the existing GST exemption is linked to a narrow definition of 'charitable activities', which applies only to persons with 'severe' disabilities. The authors say this creates an arbitrary divide, excluding many people with disabilities who require sustained support but do not meet the prescribed threshold.
The researchers have recommended shifting from a provider-based classification, where tax liability depends on the type of institution offering the service, to a service-based classification, where exemption is determined by the essential nature of the service itself.
According to the paper, neurodevelopmental conditions such as autism spectrum disorder, intellectual disability, and specific learning disabilities require lifelong, multidisciplinary interventions, making severity-based classifications inadequate. "A single numerical severity score is insufficient to capture the multidimensional and evolving support needs associated with such conditions," the paper states.
The report also highlights the economic impact on families. Therapy costs in metropolitan cities can reach ₹30,000 a month, excluding expenses on caregivers, transport, education, and assistive devices. Citing available data, the report adds that disability-related expenses account for 20.32% of household monthly consumption expenditure, while 57.1% of such households experience catastrophic health expenditure.
The report notes that countries such as Australia, Canada, and the United Kingdom have adopted service-based tax frameworks that treat disability support as an essential public good rather than discretionary consumption. It argues that as a signatory to the UN Convention on the Rights of Persons with Disabilities, India should align its tax policies with the convention's principles.
