Union Minister and prominent BJP politician Nitin Gadkari has written to Finance Minister Nirmala Sitharaman, pleading with her to remove the GST levied on life and health insurance plan premiums, in response to criticism of Budget 2024 from various sources.
In his letter, Mr. Gadkari stated that he was inspired to write to the Finance Minister by a memo that the Nagpur Divisional Life Insurance Corporation Employees Union had sent.
“Main issue raised by the Union is related to 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 premium amounts to levying tax on the uncertainties of life,” the Minister of Road Transport and Highways wrote.
“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% GST on medical insurance premium is proving to be a deterrent for the growth of this segment of business, which is socially necessary. Therefore, they have urged withdrawal of GST as mentioned above,” he has added.
According to Mr. Gadkari, the union that he met with also brought up issues about the union’s preference for savings through life insurance, the reinstatement of the IT deduction for health insurance premiums, and the combination of public and private general insurance firms.
The first Budget of the third Narendra Modi government, which was unveiled last week, has drawn criticism from a number of sources, prompting Mr. Gadkari to write the Finance Minister. Some social media users drew attention to the high tax rates paid by the salaried class, while the opposition said that the central government was only giving generous aid to states that were run by its main supporters, the TDP and JDU.
The Finance Minister refuted the accusation made by the Opposition, stating that all states received funding from the Center. She clarified that a state’s absence from the Budget speech does not imply that it is not addressed. According to the BJP, the Budget’s policy priorities point to the long-term objective of “Viksit Bharat,” or the development of India into a developed country by 2047.
