According to the PTI report, she added, “We have told them that they will look into this matter and come up with a report by the end of October 2024. The #GST Council which will meet in November, will finalise based on this report which will come from the GoM.”

Both life insurance and medical insurance premiums attract a GST rate of 18 per cent.

Recently, many leaders from opposition-ruled states have requested Finance Minister Sitharaman to reduce GST on medical insurance and premiums. West Bengal Chief Minister Mamata Banerjee has requested the central government to withdraw the Goods and Services Tax (GST) on life insurance and health insurance premiums, terming the taxation on such items as “anti-people.”

During the recently concluded Parliament session, the INDIA alliance leaders held a protest against the Central government outside the Parliament, demanding to roll back GST on health and life insurance products. Congress leader Rahul Gandhi also joined the protest.

Against that context, Sitharaman had asked the members to write to their respective state’s finance minister so that they could take it up in the GST Council meeting.

Speaking on the suggestions by many Opposition members to reduce GST on health insurance premiums, Finance Minister Nirmala Sitharaman stated that taxes were imposed on such items even before the GST regime came into effect in 2017, adds PTI.

The GST Council, consisting of the Union Finance Minister and representatives from all States and Union Territories, was established to make decisions on various aspects of GST, including tax rates, exemptions, and administrative procedures.

The GST regime was brought in to remove the inefficiencies and complexities of the previous archaic taxation system. Over the years, GST has, among others, simplified compliance and reduced the cascading impact of tax. Before July 1, 2017, the indirect tax regime was highly fragmented. The Centre and States were separately taxing goods and services.