Sitharaman counters Opposition's GST claims on health insurance, mentions Gadkari's letter
Nirmala Sitharaman said that the proposed amendment to remove GST on health insurance, as requested by opposition parties, cannot be introduced in Parliament.
Union finance minister Nirmala Sitharaman on Wednesday hit out the Opposition for their protests demanding the removal of GST on life and medical insurance premiums.
Referring to a request from Union minister Nitin Gadkari, Sitharaman said, “Since the letter came in public via someone else... they protested in the Parliament with 200 MPs to demand removal of GST.”
“I want to raise two important points - tax has been there on medical insurance even before the introduction of GST. There was already a pre-GST tax on medical insurance, before the GST was introduced. This is not a new issue, it was already there in all the states. Those protesting here... did they discuss regarding the removal of this tax in their states?”
“Wrongful protests have happened recently, and comments have been passed on the basis of a news report which suggested that the 'Centre has pocketed Rs. 24,529 crores of health insurance premiums alone'. This is incorrect and highly misleading. The GST rate of 18% on Health Insurance comprises of 9% CGST and 9% SGST. Thus, of the total collections of ₹24,529 crores from Health Insurance in the last 3 years, Half of it, Rs. 12,264 crores, went straight to the states as SGST. It doesn't even come to the Centre. Apart from this, roughly 41% of the Centre's share of GST collection on Health Insurance is devolved back to the states again as part of Tax Devolution as per the Finance Commission's formula,” she added.
Speaking to reporters at the Parliament House Complex, Sitharaman said that the GST Council, a constitutional body, has the authority to address any GST-related issues.
She added that the proposed amendment, as requested by opposition parties, cannot be introduced in Parliament.
Oppn's protest over GST on health insurance
On Tuesday, MPs from the INDIA bloc protested at the Parliament building's gate, calling for the government to withdraw the 18 per cent GST on life and health insurance premiums.
Opposition members pointed to a request from Union minister of road transport and highways Nitin Gadkari, who had urged finance minister Nirmala Sitharaman to remove the GST on these premiums.
AAP MP Raghav Chadha also referenced Gadkari's letter to Sitharaman, asking to eliminate GST on health and life insurance premiums. RSP member N K Premchandran had proposed an amendment during the Finance Bill’s passage to remove the 18 per cent GST on these premiums.
Following the rejection of Premchandran's amendment during the Finance Bill’s discussion, opposition MPs staged a walkout from the Lok Sabha.