18% GST on Life and Health Insurance Products: West Bengal CM Writes to Finance Minister

The West Bengal Chief Minister, Mamata Banerjee has written to Finance Minister Nirmala Sitharaman regarding 18% GST on Life and Health Insurance Products.

The Relevant Text of the Letter is given below:

With deep anguish, I am writing to you regarding the imposition of 18% GST on life insurance and health insurance policies/products and the. withdrawal of deductions in the new tax regime under sections BOC and 8QD of the Income Tax Act, which to me are highly anti-people in nature.

The primary objective of life and health insurance is to provide financial security and support during unexpected times such as illness, accidents and untimely deaths. These policies play a crucial role in ensuring that individuals and their families are able to cope with financial hardships during such challenging times.

However, the imposition of GST on insurance premiums increases the financial burden on the common people. This additional burden may be acting as a deterrent for many individuals from taking new policies or continuing their existing insurance coverage, thereby leaving them vulnerable to unforeseen financial distress. Moreover, insurance serves as a vital component of the social safety net, reducing the government’s burden in providing direct financial assistance to citizens during such emergencies.

We all know that health is wealth. Healthcare is a major social security and it is our commitment to extend to the common people maximum social, security in this area to ensure their good health and well-being. Health and life insurance cover are now available to all sections of society, including farmers and daily labourers. Thus, it is quite obvious that imposing the burden of GST on health and life insurance will put the common people under greater stress and anxiety and deprive them of the benefit of social security net. We must, at all costs, avoid it.

Adding, to their woes, particularly for the common people, is the withdrawal of incentives that were available under the Income Tax Act in the old tax regime.

In light of the above considerations, I request you to kindly review the anti-people taxation policies and withdraw the GST on life insurance and health insurance premiums; and include deduction under sections 80C and 80D of the Income Tax Act on such premiums in the new tax regime. In fact, this will facilitate wider insurance coverage for the common people with more mental and financial stability.

I believe you will take this request with utter seriousness and take the necessary steps to provide relief to encourage more and more common people to avail of these critical services so close to their basic livelihood issues.

For Official Letter Download PDF Given Below: