From 18% to Zero? Ministers want life, health insurance exempt from GST
The panel of state ministers wants 0% GST on life and health insurance premiums from 18% at present, Bihar's Deputy CM Samrat Chaudhary said after the meeting in New Delhi on Wednesday. That translates into a revenue loss of ₹9,700 crore, Telangana Minister Mallu Bhatti Vikramarka said.
The panel met days after Prime Minister Narendra Modi announced sweeping cuts to the GST to boost India's economy in the face of a trade conflict with the United States.
The final decision will be taken by the GST Council, which is chaired by Union Finance Minister Nirmala Sitharaman and includes all state finance ministers as members. The GST council meeting is expected in September or October, before Diwali.
The proposed GST reforms, which will reduce the number of tax slabs to two from four (not including the zero percent slab), would benefit a wide range of sectors—from cars to cement and consumer goods—as well benefit businesses of all shapes and sizes, according to industry watchers.
According to government sources quoted by the Press Trust of India, nearly 90% of the items in the 28% slab will move to 18%. Almost all the goods in the 12% slab will move to 5%. That effectively means nearly all essential goods and household items will get cheaper.
With inputs from Reuters.
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