GST Council Meeting: The GST on insurance premiums is expected to be discussed in the GST Council meeting to be held on September 9. Sources say that the council may exempt insurance premiums up to a limit from GST.

GST on Insurance Premium: Union Minister Nitin Gadkari had written a letter to Finance Minister Nirmala Sitharaman a month ago requesting to keep life and medical insurance premiums out of the purview of GST. After this, Mamata Banerjee also reiterated this demand and demanded relief for the common man. Now when the GST Council meeting is going to be held on September 9, the discussion about making insurance premium GST free has intensified. It is expected that during the meeting, the Fitment Committee may suggest charging less GST or giving a discount up to a limit on the basis of premium and sum insured.

A detailed report will be submitted on the impact on revenue

According to the news published in the Economic Times, the Fitment Committee is not in favor of giving complete GST exemption on life and health insurance premiums. The committee will submit a detailed report on the impact of GST exemption on revenue in the GST Council meeting to be held on 9 September. In the report, the impact on revenue due to giving complete GST exemption and giving less exemption will be explained separately.

Industry demands that a minimum tax of 5% should be imposed.

Currently, 18% GST is levied on insurance premiums. Opposition parties say that this is too much. At the same time, the industry demands that insurance products should be brought out of the scope of GST or a minimum tax of 5% should be imposed. However, in the case of reducing GST on insurance premiums, the committee believes that the maximum limit on insurance premiums or insured amounts or both should be up to Rs 50,000. This can prove to be effective for people of lower and middle-income groups.

An official said that where the premium is very high, there is no need to reduce the GST rate. The fitment panel has not recommended any kind of GST rate. This matter will be discussed further by the GST Council. The committee includes central and state GST officials and gives suggestions to the council regarding the GST rate. Gadkari had written a letter to the Finance Minister on the basis of the memorandum submitted by the Nagpur Mandal Jeevan Bima Nigam Employees Union.