Government May Reduce GST on Health and Term Insurance to 5%, Reports Suggest

• Government may reduce GST on health and term insurance to 5 percent from 18 percent
• Move aims to make insurance more affordable and increase penetration in India
• Prime Minister hinted at GST reforms as a Diwali gift for consumers
• Reduction in GST could result in a revenue loss of Rs 17,000 crore annually
• Abolishing GST may prevent insurance companies from claiming input tax credit
• Current GST on insurance is 18 percent, affecting policy costs for senior citizens
• Insurance regulator IRDAI supports the GST reduction
• GST reforms could ease inflation and fiscal pressure, possibly leading to a repo rate cut by RBI
• Government proposes a simpler tax structure with two slabs: standard and merit
• Finance ministry has sent GST reform proposals to the Group of Ministers for review

Source: a2ztaxcorp.net

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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