New Delhi:
Road and Transport Minister Nitin Gadkari has formally requested Finance Minister Nirmala Sitharaman to consider eliminating the Goods and Services Tax (GST) on life and health insurance premiums.
In a letter dated July 28,
Gadkari argued that the current 18% GST on these insurance products hampers their growth and adds financial strain, particularly on senior citizens.
GST Impact on Health and Life Insurance
Gadkari’s appeal is in response to concerns raised by the Nagpur Divisional Life Insurance Corporation Employees Union.
He emphasized that taxing health and life insurance is detrimental to their social significance.
The current GST rate on these premiums stands at 18%,
which Gadkari believes undermines the sector’s development and imposes an additional burden on individuals.
Call for Reduced GST Rate
Gadkari has been advocating for a reduction in GST rates on insurance premiums.
While his previous suggestion was to lower the GST to 12%, he is now pushing for a complete removal of the tax on life and health insurance.
This move is aimed at alleviating financial pressure on senior citizens and supporting the growth of the insurance sector.
The GST Council is expected to discuss these issues in its upcoming meeting in August, following its most recent meeting on June 22.
