New Delhi:
Union finance minister Nirmala Sitharaman, targetted by her critics over the 18 per cent Goods and Services Tax or GST on life and medical insurance premiums, retorted today that leaders having objection should first have consulted their state finance ministers who have a say in the GST Council. Amid growing dissidence over the GST on premiums, the government has repeatedly clarified that it was a decision of the GST Council — which has only brought more jibes from the Opposition.
Tax has been there on medical insurance even before GST was introduced, Ms Sitharaman said in the Lok Sabha today. “There was already a Service Tax on medical insurance, before the GST was introduced. This is not a new tax, it was already there in all the states,” she said.
“Those protesting here, did they discuss regarding the removal of this tax in their states? Did they write to the Finance Ministers of their respective states about it and asked them to raise it in the GST Council where states have 2/3rd part? No, but they are protesting here. This is their double standards, this is their drama,” she said.
Among those having reservations about the tax is Ms Sitharaman’s cabinet colleague Nitin Gadkari, who was among the first to write to her about the issue.
In a letter dated July 28, Mr Gadkari had raised the concerns of the Life Insurance Corporation Employees Union in Nagpur, and said levying GST on insurance amounts to “taxing the uncertainties of life”.
“Similarly, the 18 per cent GST on medical insurance premiums is proving to be a deterrent for the growth of this segment of business which is socially necessary. In view of the above, you are requested to consider the suggestion of withdrawal of GST on life and medical insurance premiums on priority,” read the letter from the Road Transport and Highways Minister.
His stance was echoed by Congress’s Rahul Gandhi, who, in a social media post, claimed that the BJP looks for a “tax opportunity” in every disaster, which is proof its “insensitive thinking”.
“The Modi government has looted Rs 24,000 crore even from those who save every penny to avoid bowing before anyone in the event of a health crisis,” read a rough translation of his post in Hindi. Rahul said in a post in Hindi.
The GST on premiums was announced in this year’s budget, which has been criticised by many. The Opposition parties have accused the Centre of being generous only to Bihar and Andhra Pradesh — states ruled by its allies TDP and JDU. In social media, many have pointed to the high tax burden on the salaried middle class.
The Finance Minister has trashed the Opposition allegations, saying the Centre has provided funds to all states. If a state has not been mentioned in the Budget speech, it does not mean it is not covered, she said.
