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The ToR also include suggest tax rates on life insurance, including term insurance, life insurance with investment plans, whether individual or group and re-insurance
The ministerial panel to decide on lowering goods and services tax (GST) on health and life insurance premiums will have its first meeting on October 19, officials said.
Currently, 18 per cent GST is levied on insurance premiums and there have been demands to either exempt or reduce the tax.
The GST Council in its meeting earlier this month decided to set up a 13-member GoM to decide on tax on health and life insurance premiums.
Bihar Deputy Chief Minister Samrat Choudhary is the convenor of the GoM.
The panel includes ministers from Uttar Pradesh, Rajasthan, West Bengal, Karnataka, Kerala, Andhra Pradesh, Goa, Gujarat, Meghalaya, Punjab, Tamil Nadu, and Telangana.
The GoM has been mandated to submit its report to the Council by October-end.
A final call by the council on taxation of insurance premiums is likely to be taken in the next meeting in November, based on the GoM report.
“The GoM on GST on insurance will meet on October 19 in Delhi,” the official said.
The terms of reference (ToR) of the panel also includes suggesting tax rate of health/medical insurance, including individual, group, family floater, and other medical insurance for various categories like senior citizens, middle class, persons with mental illness.
The ToR also include suggest tax rates on life insurance, including term insurance, life insurance with investment plans, whether individual or group and re-insurance.
Some Opposition-ruled states, including West Bengal, had demanded complete exemption of GST on health and life insurance premiums, while some other states were in favour of lowering the tax to 5 per cent.
Even Union Transport Minister Nitin Gadkari had in July written to Finance Minister Nirmala Sitharaman on the issue saying “levying GST on life insurance premium amounts to levying tax on the uncertainties of life”.
In 2023-24, the Centre and states collected Rs 8,262.94 crore through GST on health insurance premium, while Rs 1,484.36 crore was collected on account of GST on health reinsurance premium.
Sitharaman in her reply to discussion on Finance Bill in the Lok Sabha in August had said that 75 per cent of the GST collected goes to states and the Opposition members should ask their state finance ministers to bring the proposal at the GST Council.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
First Published: Sep 26 2024 | 12:12 PM IST
