Waive GST on life insurance policies, says AIIEA

    No tax imposed on savings models such as fixed deposits or mutual funds, say members

    At the ongoing 25th National Conference of All India Insurance Employees Association, the members resolved to demand the withdrawal of GST from life insurance policies, here on Wednesday.

    M. Girija, Joint Secretary of AIIEA, pointed out that the Union Government has not imposed GST on other savings models such as fixed deposits or mutual funds, but is imposing GST on life insurance policies that vary from 2.5% to 18%. “Even insurance policies are savings and they cannot be treated differently,” she said.

    The members voiced their disapproval against the disinvestment in LIC. They were of the opinion that LIC being the largest government-owned insurance company, the proposal of disinvestment should be shelved.

    “From an invest of ₹5 crore in 1956, the company has grown phenomenally and today has an asset value of over ₹31 lakh crore. Its solvency rate is over 158%, so where is the need to privatise it?” asked K. Venugopal, president of South Central Zonal Insurance Employees Federation.

    He further added that about 82% of its revenue is invested in government schemes and 85% of its surplus is invested in government equity. “Privatisation will not benefit either the corporation or the government, so why is this bill being mooted?” he questioned.

    AIIEA has also taken a decision to oppose the disinvestment in three general insurance PSUs. “There is a move to merge the three government-owned general insurance companies such as United India Company, The National Insurance Company and Oriental Insurance Company and then privatise them. We welcome the merger but not the privatisation,” Mr. Venugopal said.

    Moreover, the members were of the opinion that in the government-owned insurance companies including LIC, people are the major stakeholders, and hence there is a need to involve the public and take their opinion on disinvestment before the bill can be tabled.

    AIIEA has also decided to urge the Union Government to increase the exemption limit of insurance policies for filing Income Tax returns.

    “People invest in insurance policies and the amount is utilised by the government in building infrastructure. Keeping this in mind, the government should increase the exemption limit, which would encourage people to invest more. The amount can be utilised for nation-building,” Ms. Girija said.

    The four-day conference will end on Thursday, and a draft resolution copy will be handed over to the Union Government.

    Source- The Hindu.

The post Waive GST on life insurance policies, says AIIEA appeared first on GST Station.



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