New Delhi : The first meeting of the Ministerial Committee i.e. GoM is scheduled to be held on October 19 on the decision to reduce the GST on health and life insurance premiums. Currently 18 percent GST is levied on insurance premium. The demand to reduce or remove this GST rate has been going on for a long time.
The GST Council, in its meeting earlier this month, had decided to set up a 13-member group of ministers to decide on the tax on health and life insurance premiums. Bihar Deputy Chief Minister Samrat Chaudhary is the convener of the Group of Ministers. It includes ministers from Uttar Pradesh, Rajasthan, West Bengal, Karnataka, Kerala, Andhra Pradesh, Goa, Gujarat, Meghalaya, Punjab, Tamil Nadu and Telangana.
GOM in Delhi on 19 October
The Group of Ministers has been ordered to submit its report to the Council by the end of October. A final decision on the issue of tax on insurance premiums will be taken by the Council in its next meeting in November, based on the GoM report. The official said, “The Cabinet meeting i.e. GOM on the issue of GST on insurance is going to be held in Delhi on October 19. ,
Also read:- Piyush Goyal talked about bringing Public Trust Bill 2.0 in the next budget session.
provision for suggesting rates
The terms of reference of the Committee i.e. TOR include health and life insurance including individual, group, 'family floater' and other health insurance for various categories like senior citizens, middle class, people suffering from mental illness. Besides, their tax rate will also be discussed. The ToR also has a provision to suggest tax rates on life insurance. This includes term insurance, life insurance along with investment plans, whether individual or group and reinsurance.
Nitin Gadkari wrote a letter to the Finance Minister
Some opposition-ruled states, including West Bengal, have demanded complete exemption from GST on life and health insurance premiums while some others were in favor of reducing the state tax to 5 percent. Union Transport Minister Nitin Gadkari had also written a letter to Finance Minister Nirmala Sitharaman on this issue in July, saying that “imposing GST on life insurance premium is like imposing tax on the uncertainties of life.”
Proposal in GST Council
In the financial year 2023-24, the Center and states collected Rs 8,262.94 crore through GST on health insurance premiums, while Rs 1,484.36 crore was collected from GST on health reinsurance premiums. Sitharaman, in her reply during the discussion on the Finance Bill in the Lok Sabha in August, had said that 75 per cent of the GST collection goes to the states and opposition members should ask the finance ministers of their states to bring a proposal in the GST Council.
(with agency input)
Comments are closed.