Government Collects Rs 8,263 Crore GST on Health Insurance

New Delhi: The government has collected Rs 8,263 crore towards GST on health insurance premiums in the 2023-24 fiscal year, Parliament was informed on Monday. Minister of State for Finance Pankaj Chaudhary addressed the Lok Sabha, stating that despite representations requesting exemptions or reductions, GST on health insurance premiums remains at 18%.

GST Collections and Exemptions

Chaudhary detailed the GST collections, noting that in 2023-24, Rs 8,262.94 crore was collected from health insurance premiums, with an additional Rs 1,484.36 crore from health reinsurance premiums. This marks an increase from the previous years, with Rs 7,638 crore collected from health insurance premiums in 2022-23 and Rs 963 crore from health reinsurance premiums. In 2021-22, the figures stood at Rs 5,354 crore and Rs 826 crore, respectively.

However, certain schemes catering to the poor and differently-abled, such as Rashtriya Swasthya Bima Yojana (RSBY), Universal Health Insurance Scheme, Jan Arogya Bima Policy, and Niramaya Health Insurance Scheme, are exempt from GST.

Industry Requests and Government Response

In response to industry demands for GST exemptions on life and health insurance, Chaudhary reiterated that GST rates and exemptions are decided by the GST Council, a constitutional body with representatives from the Centre and States/UTs. He acknowledged the requests but emphasized the government's stance on maintaining the current GST rate for these services.

Future Outlook

Chaudhary’s statements highlight the government's commitment to maintaining GST on health insurance premiums while also recognizing the need for targeted exemptions for vulnerable sections. The significant revenue from GST on health insurance underscores its importance in the broader fiscal framework, even as discussions about potential rate adjustments continue within the GST Council.