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Two Groups of Ministers (GoM) are going to meet on Saturday . Its main objective is to rationalize GST (Goods and Services Tax) rates and reduce tax rates on health and life insurance premiums.

 

First meeting on health insurance

This will be the first meeting of the group of ministers formed to reduce the tax rate on insurance premiums from 18 percent. This group is headed by Bihar Deputy Chief Minister Samrat Chaudhary. This group will give suggestions to reduce the tax on insurance premiums, so that more people can take advantage of it.

Structure of GST

There are four types of tax rates in GST: 5, 12, 18, and 28 percent. Essential goods are either exempted from tax or attract the lowest rate. On the other hand, luxury goods attract the highest rate.

 

2nd Group of Ministers Meeting

Another group headed by Chaudhary will also meet. This group will consider rationalizing GST rates. It will discuss reducing the rate from 12 percent, bringing more items under the 5 percent bracket, and rationalizing taxes on medicine, drugs, bicycles, and bottled water.

revenue offset

This group will also discuss how the revenue shortfall can be compensated by reducing the tax rate on essential commodities. For this, suggestions can be given to increase tax on aerated drinks and other items.

Importance of health insurance

The GST Council had constituted another ministerial group to reduce the tax rate on health and life insurance premiums. This group has to submit its report by the end of October. This group will give suggestions on the tax rate of medical insurance for various categories such as the elderly and the middle class.

Effects on the economy

In the last financial year, the Centre and the states collected a revenue of Rs 8,262.94 crore from GST on health insurance premiums. This makes it clear how important the health insurance sector is.

Thus, these meetings will not only help in making the insurance premium cheaper but will also increase the accessibility of healthcare services to different sections of the society.

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