GST Exemption on Health and Life Insurance: Awaiting GoM Recommendations

The Central government is awaiting the Group of Ministers (GoM) recommendations, constituted by the GST Council, for a decision on exempting GST on health and life insurance policies, as stated by Pankaj Chaudhary, Minister of State in the Ministry of Finance, in the Lok Sabha.

During the 54th GST Council meeting on September 9, 2024, the proposal for exemption or reduction of GST on health and life insurance was deliberated. Consequently, a GoM was established, which held its first meeting on October 19, 2024, to evaluate these issues. The GoM’s recommendations, once submitted, will be reviewed in the next GST Council meeting.

Current GST Exemptions on Insurance:

Health insurance for differently-abled and economically weaker sections:

Rashtriya Swasthya Bima Yojana

Universal Health Insurance Scheme

Jan Arogya Bima Policy

Niramaya Health Insurance Scheme

Life insurance under specific schemes:

Varishtha Pension Bima Yojana

Pradhan Mantri Jeevan Jyoti Bima Yojana

Pradhan Mantri Jan Dhan Yojana

Pradhan Mantri Vaya Vandana Yojana

Government-sponsored insurance schemes like Ayushman Bharat Pradhan Mantri Jan Arogya Yojana are also exempt.

The government envisions comprehensive life, health, and property insurance coverage for all citizens by 2047, aligning with IRDAI’s long-term goals.