The GST Council is set to meet on Monday to discuss key issues, including the taxation of insurance premiums, suggestions from the Group of Ministers (GoM) on rate rationalisation, and a status report on online gaming, sources said.
The council, chaired by Finance Minister Nirmala Sitharaman and comprising state ministers, will consider reducing the goods and services tax (GST) on health insurance from the current 18 per cent or offering exemptions for certain groups, such as senior citizens.
Discussions will also focus on lowering GST on life insurance premiums.
The fitment committee, composed of tax officials from the Centre and states, will present a report on GST levied on life, health, and reinsurance premiums, along with their revenue impact.
In 2023-24, ₹8,262.94 crore was collected in GST on health insurance premiums, and ₹1,484.36 crore from reinsurance premiums.
The issue of insurance premium taxation has been raised in Parliament, with opposition members demanding exemptions. Even Transport Minister Nitin Gadkari has urged Sitharaman to address the matter.
During the Finance Bill discussions, Sitharaman noted that 75 per cent of GST collections go to states and suggested that opposition members push their state finance ministers to bring proposals to the GST Council.
West Bengal Finance Minister Chandrima Bhattacharya had already raised the issue in the GoM's rate rationalisation meeting, which then referred it to the fitment committee for further analysis.
The GoM has opposed any immediate changes to the current four-tier GST structure of 5, 12, 18, and 28 per cent but has asked the fitment committee to explore potential rate rationalisation.
The council will also receive a status report on GST revenue from the online gaming sector. From 1 October 2023, a 28 per cent GST was imposed on entry-level bets placed on gaming platforms and casinos, clarifying earlier tax differences between games of skill and games of chance.
Offshore gaming platforms are also required to register with GST authorities or face a ban.
The council had agreed to review taxation on the online gaming sector after six months of implementation, but sources indicated that rate changes are unlikely at this meeting.
In addition, the council will review the progress of a drive aimed at identifying fake GST registrations, which began on 16 August 2024. The initiative aims to detect and eliminate fraudulent GST Identification Numbers (GSTINs).
A previous drive between May and July 2023 uncovered 21,791 non-existent entities, with suspected tax evasion amounting to ₹24,010 crore.
The council is also expected to approve notifications, including an amnesty scheme announced during the last meeting, and review taxpayer-friendly measures, such as the waiver of interest and penalties for GST demand notices from 2017-18 to 2019-20, provided the full tax is paid by 31 March 2025.
Additionally, monetary limits for filing appeals in various courts were set, and pre-deposit requirements for taxpayers filing appeals under GST were reduced.
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