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<h1>Service tax on cashless hospitalization withdrawn, insurers do not charge and prior hospital charges were reimbursed subject to sum insured.</h1> Public sector general insurance companies do not levy service tax on cashless hospitalization claims. Hospitals had charged service tax on such cashless hospitalization under the Finance Act, 2010, and insurers reimbursed those amounts for admitted claims subject to the sum insured limit. The service tax on cashless payments was withdrawn by Government Notification No.30/2011, effective from 1 May 2011, eliminating the tax on cashless hospitalization transactions.