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In the letter addressed to the FM, Gadkari mentioned: “Main issue raised by the Union is related to withdrawal of GST on Life and Medical Insurance Premium.Both life insurance and medical insurance premiums attract a GST rate of 18 per cent. Levying GST on life insurance premium amounts to levying tax on the uncertainties of life.”
“The Union feels that the person who covers the risk of life’s uncertainties to give some protection to the family should not be levied tax on the premium to purchase cover against this risk. Similarly, the 18% GST on medical insurance premium is proving to be a deterrent for the growth of this segment of business which is socially necessary. Therefore, they have urged withdrawal of GST as mentioned above,” he added.
The minister famous that the Union has put forth a number of options, together with the availability of Differential Treatment to Savings via Life Insurance insurance policies. Additionally, they’ve advocated for the reinstatement of Income Tax deductions for well being insurance premiums paid by people.
Furthermore, the Union has proposed the consolidation of public and sector normal insurance firms, with the goal of streamlining operations and bettering effectivity within the insurance business.
“In view of the above, you are requested to consider the suggestion of withdrawal of GST on life and medical insurance premium on priority as it becomes cumbersome for senior citizens as per rules with due verification,” he added.
The Union street transport and highways minister wrote the letter following the Nagpur Divisional Life Insurance Corporation Employees Union’s submission of a memorandum to the minister. The memorandum sought motion on points affecting the insurance business.
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