New Delhi, 07 September (HS): The 54th meeting of the Goods and Services Tax (GST) Council is going to be held in the capital New Delhi on Monday, September 9. In this meeting, people taking health and life insurance are likely to get relief from expensive premiums (insurance installments).

Official sources said on Saturday that the GST rate on both types of insurance (health and life insurance) can be reduced from 18 percent to 5 percent in the 54th meeting of the GST Council to be held under the chairmanship of Finance Minister Nirmala Sitharaman in the capital New Delhi on September 9, 2024. However, the rate of GST on health and life insurance may burden the government treasury.

The issue of removing the 18 percent GST rate on health and life insurance premiums has now taken a political turn. It started with Union Road Transport and Highways Minister Nitin Gadkari writing a letter to Finance Minister Sitharaman. After this, West Bengal and now Karnataka Health Minister Dinesh Gundu Rao wrote a letter to Prime Minister Narendra Modi demanding a cut in the 18 per cent GST rate on health insurance for middle and low income group policyholders.

After the request of the Department of Financial Services to reduce the existing GST tax rate on health and life insurance, the Fitment Committee comprising revenue officials of the Center and the States nominated by the GST Council has done a detailed analysis of it. The Fitment Committee may submit its detailed report in this regard in the GST Council meeting to be held on September 9. This is likely to put a burden of Rs 6.5 billion to Rs 35 billion on the government treasury.

It is worth mentioning that during the budget session on August 7, while responding to the discussion on amendments to the Finance Bill 2024, Finance Minister Sitharaman had said that I want to mention two important points here. He had said that health insurance was taxed even before the implementation of GST. This is not a new issue, it was already there in all the states.

Hindusthan Samachar / Indrani Sarkar