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Nitin Gadkari, Minister for Road Transport and Highways, has written to Finance Minister Nirmala Sitaraman to withdraw GST on life and medical insurance premiums.
In a letter to the FM, Gadkari said, the Nagpur Divisional Life Insurance Corporation Employees Union has submitted a memorandum to him on the issues pertaining to the insurance industry.
The main issue raised by the Union was related to the 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 premiums amounts to levying tax on the uncertainties of life, he said in the letter.
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 per cent GST on medical insurance premiums is proving to be a deterrent for the growth of this segment of business, which is socially necessary, said Gadkari.
The Union has also raised points related to differential treatment to savings by way of life insurance, re-introducing the IT deduction for health insurance premiums and consolidating public and sector general insurance companies, he said.
“You are requested to consider the suggestion of Withdrawal of GST on Life and Medical Insurance Premium on priority as it becomes cumbersome for the senior citizens as per rules with due verification along with other relevant points raised,” said the letter.
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