The 55th GST Council meeting, held on Saturday, concluded without major decisions, with the highly anticipated reduction in GST rates for health and life insurance premiums being deferred. The Council decided that further discussions are needed before moving forward with any changes to the current rates. The Group of Ministers (GoM) on insurance had recommended a full waiver of GST on premiums for health insurance policies with coverage up to Rs 5 lakh, as well as no GST on premiums for term insurance policies.
Bihar Deputy Chief Minister Samrat Choudhary, who spoke to the media after the meeting, explained that some members of the Council felt more discussions were necessary on the issue. He also noted that the report on rate rationalisation, which includes the decision on 148 items with pending rates, was not presented at the meeting, contributing to the delay in decisions. Choudhary, who heads the GoM on rate rationalisation, mentioned that discussions on the matter are ongoing.
In a separate decision, the GST Council agreed to increase the tax rate on used smaller cars from 12% to 18%, marking a significant change for the automotive sector. However, the delay in finalizing the GST rate reduction for insurance premiums leaves the issue unresolved for the time being.
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