Recently, vide Circular No. 51/25/2018-GST dated 31st July, 2018, the CBIC has clarified that the services provided by the Private Service Providers (PSPs) to the State Governments by way of transportation of patients in an ambulance on behalf of the State Governments against consideration, would be exempt from payment of GST (covering by Serial No. 3 and 3A of Notification No. 12/2017- Central Tax (rate) date 28.06.2017).

Earlier, the Board had issued an clarification vide Circular No. 210/2/2018-Service Tax dated 30.05.2018, where it was clarified that the ambulance services provided by PSPs to State Governments under National Health Mission is a service provided to Government by way of public health and hence exempted under NN. 25/2012-ST.

Under GST, the functions of ‘Health and sanitation’ is entrusted to Panchayats under Article 243 G of Constitution and functions of ‘Public health’ is entrusted to Municipalities under Article 243W of the Constitution,  thus, the ambulance services are an activity in relation to the functions entrusted to Panchayats and Municipalities under Article 243G and 243W of the Constitution. Therefore, the same would be covered by Serial No. 3 and 3A of Notification No. 12/2017- Central Tax (rate) date 28.06.2017, i.e. GST would be exempted where pure services has been provided to Central Government, State Government, Union Territory Government, local authority and governmental authority by way of an activity in relation to the function entrusted to Panchayats under Article 243G or Municipalities under Article 243W of the Constitution.