Lower GST to Stem Slowdown in Sales of Life Insurance Policies: Insurers Request GST Council Insurance companies have approached the GST Council with a request to reduce GST rates on life and health insurance products.

1. The Request The companies are seeking a phased reduction in GST rates, starting with life insurance, followed by health insurance. They have submitted a detailed representation seeking a reduction in GST rates on life insurance products from the current 18% to 12%.

2. The Reason High GST rates are causing people to opt out of life insurance and look for alternatives. The government’s agenda to promote inclusive growth and an insured society is being defeated as premiums and products become more expensive.

3. The Demand Insurers are also demanding a similar reduction from the current 18% to 12% on health insurance, following the reduction in life insurance. They have also asked the GST council for clarity on the applicability of GST to co-insurance.

4. The Proposal Insurance companies are asking the council to consider the removal of GST on outsourcing or sharing the insurance burden by one company with another under sub-contracting.

They have sought urgent intervention from the government, and it is likely that the new government, after assuming office, could take this representation to the GST council for a detailed deliberation.

5. The Process If these proposals are considered, they will have to be cleared by the GST council-nominated law committee, fitment committee, and officers before the council takes them up formally.

This news highlights the need for a review of the current GST rates on insurance products to ensure the growth of the insurance sector and the financial security of the society. #GST #Insurance #TaxReform