Quick Summary
The Department of Finances Joint Secretary has hinted at a potential reduction in Goods and Services Tax (GST) on life and health insurance premiums, making them more affordable for customers, as per a report. Currently, an 18% GST is levied on premiums for term life insurance and health policies, including family floater plans. However, the government is considering exempting GST on specific insurance products. The government recently received requests on the exemption of GST on term life and
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FAQ :
Currently, an 18% GST is levied on premiums for term life insurance and health policies.
Yes, the government is considering exempting GST on specific insurance products, particularly health insurance.
Senior citizens are expected to benefit significantly, especially from a potential GST exemption on health insurance policies.
The proposed exemption for health insurance is for policies up to ₹5 lakh.
A decision on this issue is expected to be made by the GST Council, following the submission of a report by the Group of Ministers by the end of October.
It is unlikely that all premiums will be exempt. Premiums for health insurance packages over ₹5 lakh will still attract an 18% GST, though exemptions for senior citizens might apply irrespective of the limit.
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