GST Council Deliberations: Tax Cuts on Insurance and Rate Rejigs Shelved

The GST Council, led by Union Finance Minister Nirmala Sitharaman, deferred decisions on tax reductions for health and life insurance. Deliberations continue on goods rate rationalization and extending GST compensation cess. The GoM proposes significant tax adjustments across sectors, including insurance, luxury goods, and common commodities.

The GST Council meeting on Saturday, headed by Union Finance Minister Nirmala Sitharaman, postponed decisions on reducing taxes on health and life insurance policies. The awaited GoM recommendation to overhaul tax rates on 148 items was notably absent from the agenda.

Finance Minister Sitharaman and her state counterparts decided further discussions are necessary before finalizing insurance taxation. The council's subgroup, chaired by Bihar Deputy Chief Minister Samrat Chaudhary, will meet again in January to deliberate on taxation for various insurance policies, including group, individual, and senior citizens' policies.

Meanwhile, discussions on bringing Aviation Turbine Fuel (ATF) under the GST and reviewing the Fitment Committee's suggestions were lined up. Proposed changes include a rate cut on food delivery services and adjustments in tax rates for vehicles and consumer goods, highlighting a comprehensive review of existing GST structures.

(With inputs from agencies.)