Centre may push for 12% GST for health insurance; lower rate seen to widen cover
To make health insurance more affordable and attractive, the Centre may push for a lower GST tax rate to 12%, compared to 18% now, on health insurance premiums up to Rs 30,000.
Going by the current market rates, a premium up to Rs 30,000 could buy health insurance sum insured around Rs 10 lakh/annum for a family of four members, depending upon various factors such as type of coverage, age of insured, and so on.
A reduction in the tax rate could lead to a lowering of premium rates or offering additional health cover options, depending on the requirements of people, an official said.
“This is one of the pending proposals which may be taken up after the general elections in the GST Council,” the official said.
In February this year, the Parliamentary Standing Committee on Finance headed by BJP MP Jayant Sinha had said there was a need to rationalise the 18% GST rate on insurance products, especially health and term insurance.
