GST Council to Decide on Lowering Health Insurance GST Rate
The 54th GST Council meeting, chaired by Finance Minister Nirmala Sitharaman, will make a major decision on the GST rate on health insurance premiums on Monday. The Council is likely to reduce the GST rate on health insurance premiums from 18% to nil, providing significant relief to individuals and senior citizens. However, the 18% GST rate on group health insurance premiums is expected to remain unchanged.
The fitment committee, which includes central and state tax officials, discussed the pros and cons of reducing the GST rate on health premiums. A report on GST levied on life, health, and reinsurance premiums, along with the revenue implications, will be presented before the GST Council. Council members will then discuss and decide on the proposed changes.
Additionally, the Council will consider a proposal to tax online payments above Rs 2,000, which are currently not taxed when made through payment gateways.
Last month, Samrat Chaudhary, Bihar Deputy CM and Convenor of GST GoM on rate rationalisation, mentioned that proposals for rate changes in the health insurance sector were under review. West Bengal Finance Minister Chandrima Bhattacharya also requested a reduction in the 18% GST rate on life and health insurance premiums.
In the previous GST Council meeting held on June 22, Finance Minister Nirmala Sitharaman announced several significant measures, including Aadhaar biometric integration and exemptions in railway services.
Doubts Revealed
GST Council -: The GST Council is a group of people from the Indian government who decide how much tax should be charged on different things. GST stands for Goods and Services Tax.
Finance Minister -: The Finance Minister is a person in the government who is in charge of money matters for the country. Right now, Nirmala Sitharaman is India’s Finance Minister.
GST rate -: The GST rate is the percentage of tax that you have to pay when you buy something. For health insurance, it is currently 18%.
Health insurance premiums -: Health insurance premiums are the money you pay regularly to an insurance company so that they will help pay for your medical expenses if you get sick or hurt.
Senior citizens -: Senior citizens are older people, usually those who are 60 years old or more.
Group health insurance -: Group health insurance is a type of health insurance that covers a group of people, like employees of a company, under one policy.
Online payments -: Online payments are when you pay for something using the internet, like using a credit card or a digital wallet.
Fitment committee -: The fitment committee is a group of experts who study and suggest changes to tax rates and rules. They help the GST Council make decisions.