Shares of Star Health and Allied Insurance Company Limited fell by over 2% on December 23, trading at ₹475.30, following the GST Council’s decision to defer discussions on granting tax relief for health and life insurance premiums.
The council, during its meeting on December 21, postponed a decision on the matter to allow more time for building a consensus.
Key Developments:
- Recommendations by GoM: The Group of Ministers (GoM) had suggested exempting GST on health insurance for senior citizens and term life insurance. Additionally, they proposed reducing the GST rate to 5% for health insurance policies with coverage up to ₹5 lakh.
- Current Taxation: Presently, premiums for life and health insurance attract an 18% GST rate.
This decision impacted investor sentiment around insurance stocks, leading to declines in the share prices of companies like Star Health. The market is likely to monitor developments on the GST exemption closely for further direction.
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Star Health