- Finance Minister Nirmala Sitharaman announced GST exemption on individual health and life insurance policies
- GST on 33 lifesaving medicines for cancer and chronic diseases reduced to nil from 12%
- Insurance services previously taxed at 18% will now be exempted
Finance Minister Nirmala Sitharaman announced on Wednesday an exemption on individual health and life insurance along with 33 lifesaving drugs and medicines.
The insurance services that are currently under 18% will be exempted. Even individual health insurance policies, including family floater policies and policies for senior citizens, will be exempted.
"Exemption of GST on all individual life insurance policies, whether term life, ULIP, or endowment policies, and reinsurance," the finance minister said.
Additionally, taxes on 33 lifesaving medicines has been reduced to nil from the earlier 12%. While the GST on cancer medicines and medication for rare diseases came down from 5% to nil, blood glucose monitoring systems are taxed at 5% rate.
The Goods and Services Tax Council announced a sweeping cut in tax rates. The Union government also reduced the taxation slabs from four slabs to two slabs of 5% and 18% respectively. The changes will take effect from Sept. 22, with phased implementation for certain items.
Among other things that have been exempted, essentials such as milk, paneer, butter have been granted steep GST cuts or exemptions, while tobacco products, aerated drinks, luxury cars and yachts will attract higher taxes of up to 40%.
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