Nitin Gadkari urges Finance Minister to remove 18% GST on life, medical insurance premiums

Nitin Gadkari, the Union Minister for Road Transport and Highways, has formally requested Finance Minister Nirmala Sitharaman to withdraw the 18 percent Goods and Services Tax (GST) on life and medical insurance premiums. In his letter dated July 28, Gadkari argued that this tax places an undue burden on senior citizens and impedes the growth of the insurance sector.

Gadkari stated that taxing insurance premiums effectively means taxing the uncertainties of life, which is unjust for those who seek financial protection for their families. He expressed concern that the high tax rate is discouraging people from investing in insurance and hindering the overall expansion of this crucial industry.

Advertisement

The minister’s request follows a memorandum submitted by the Nagpur Divisional Life Insurance Corporation Employees Union. The union highlighted the difficulties faced by the insurance sector due to the GST and called for relief measures. Gadkari also noted that the union has raised issues regarding the differential treatment of savings through life insurance and the need for income tax deductions for health insurance premiums.

The GST Council, which is responsible for making decisions on tax matters, is scheduled to meet in August to discuss various issues, including the GST on insurance premiums. The last meeting of the council was held on June 22.