Finance Minister Nirmala Sitharaman Discusses GST and Budget 2024-25 in Parliament
New Delhi, August 8: Finance Minister Nirmala Sitharaman spoke in the Rajya Sabha about the GST proposals and the 2024-25 Finance Bill. She mentioned that the fitment committee, which handles GST proposals, includes members from all states, even those ruled by the Opposition.
GST on Insurance Premiums
Opposition members raised concerns about GST on medical insurance premiums. Sitharaman suggested they discuss it with their state finance ministers to bring it up in the GST Council meeting. She explained that both life and medical insurance premiums have an 18% GST rate, which existed before the GST regime started in 2017. She clarified that 73-74% of the GST collected on health insurance premiums goes to the states.
Protests and Opposition Requests
Leaders from Opposition-ruled states, including West Bengal Chief Minister Mamata Banerjee, have asked for the removal of GST on insurance premiums. The INDIA alliance leaders, including Congress leader Rahul Gandhi, protested against the GST on health and life insurance products outside Parliament.
Budget 2024-25 Highlights
Sitharaman highlighted the government’s efforts to provide tax relief to the middle class and the positive impact of capital expenditure (capex) on the economy. She mentioned the increase in the standard deduction for salaried employees and the exemption limit for capital gains on certain financial assets. The Finance Bill 2024, Appropriation Bill 2024, and Jammu and Kashmir Appropriation Bill 2024 were returned to the Lok Sabha, completing the budget process.
Support for Startups
To support startups, Sitharaman proposed abolishing the angel tax for all classes of investors. This move is expected to drive more investments into startups, boosting economic growth and innovation.
Sitharaman presented the Union Budget 2024 on July 23, marking her seventh consecutive budget. The budget session of Parliament began on July 22 and will end on August 12.
Doubts Revealed
Finance Minister -: The Finance Minister is a person in the government who is responsible for managing the country’s money, including taxes and spending.
Nirmala Sitharaman -: Nirmala Sitharaman is the current Finance Minister of India. She helps make decisions about how the government spends and collects money.
GST -: GST stands for Goods and Services Tax. It is a tax that people pay when they buy goods (like toys) and services (like haircuts).
Budget 2024-25 -: The Budget 2024-25 is a plan made by the government about how it will spend and collect money for the years 2024 and 2025.
Parliament -: Parliament is a place where important people in the government meet to make laws and discuss important issues for the country.
Insurance premiums -: Insurance premiums are the money people pay regularly to an insurance company to protect themselves from big expenses, like hospital bills.
Opposition members -: Opposition members are people in the government who are not part of the ruling party. They often question and challenge the decisions of the ruling party.
State finance ministers -: State finance ministers are people in charge of money matters in each state of India. They help manage the state’s budget and taxes.
Tax relief -: Tax relief means reducing the amount of tax people have to pay, which can help them save more money.
Middle class -: The middle class refers to people who are neither very rich nor very poor. They usually have stable jobs and can afford basic needs and some extras.
Capital expenditure -: Capital expenditure is money the government spends on big projects like building roads, schools, and hospitals to improve the country.
Angel tax -: Angel tax is a tax on the money that startups receive from investors. Abolishing it means startups won’t have to pay this tax, making it easier for them to grow.
Startups -: Startups are new companies that are just beginning to develop. They often have innovative ideas and need support to grow.
Finance Bill -: The Finance Bill is a proposal made by the government about how it will collect and spend money. It needs to be approved by Parliament to become a law.
Lok Sabha -: Lok Sabha is one of the two houses of Parliament in India. It is where elected representatives discuss and pass laws.