BRS negligence led to 445cr GST payment
Hyderabad: The Comptroller and Auditor General (CAG) report has pulled up the previous BRS govt for financial negligence resulting in payment of Rs.445 crore in GST. The CAG said state could have saved the amount if the agriculture department had cared to claim the available GST exemption on LIC premium paid while implementing Farmers Group Life Insurance Scheme.
The scheme was launched by BRS govt in partnership with LIC in June 2018. Between July 2018 and Sept 2021, the department paid 3,649.92 crore — including GST of 445 crore — to LIC as premium.
Report stated as per GST Council’s decision in 2017, services provided to central/state govts under any insurance scheme, for which the premium was paid by govt, was exempt from GST. CAG said not only the state didn’t seek GST exemption but it failed to incorporate a clause on GST exemption in the MoU with LIC.
Hence, the department paid 445 crore in GST for 2018-19 to 2020-21. Agriculture department took up the issue with LIC in 2021 and availed GST exemption from 2021-22.
