No consensus among states on GST relief for health insurance premium
The states continue to remain divided over a proposal to exempt health insurance premium from Goods and Services Tax (GST), with the Fitment Committee, comprising revenue officials from both the state and Union governments, struggling to reach a consensus on the contentious issue.
A decision to this effect is likely to be taken during the upcoming GST Council, chaired by Union Finance Minister Nirmala Sitharaman, meeting to be held in Delhi on September 9.
Various options, including exemptions for senior citizens, partial exemptions, or reducing the tax rate of 5 percent with or without the Input Tax Credit (ITC), are still under discussion, according to two officials, who are privy to the matter.
The proposal to exempt health insurance premium from GST has sparked a debate amid states expressing concerns about the potential revenue loss, which is likely to range between Rs 3,200 and Rs 4,000 crore. However, the final loss figure depends on the retention of ITC, the officials said.
