55th GST Council Meeting: Jet fuel inclusion, lower taxes on insurance policies to be considered

As the GST Council gathers up for a meeting, a number of key decisions are in the spotlight, including a lower tax rate on insurance products and the inclusion of aviation turbine fuel (ATF) in the indirect tax regime. The 55th meeting of the Council began in Jaisalmer in Rajasthan on Saturday morning. The all-powerful GST Council is chaired by Finance Minister Nirmala Sitharaman and comprises her state counterparts. A Group of Ministers (GoM) under Bihar Deputy Chief Minister Samrat Chaudhary had in November suggested exempting insurance the premiums paid for term life insurance policies from the ambit of GST. The panel also suggested that the premium paid by senior citizens towards health insurance should be exempted from the tax.

Additionally, the panel also has suggested exempting indirect tax applicable to the premiums paid by individuals, other than senior citizens, for health insurance with coverage of up to Rs 5 lakh. However, on policies with coverage of more than Rs 5 lakh will attract an 18 per cent GST on the premiums paid.

A final decision on insurance GST is likely in Saturday's meeting, with most states in favour of lower taxes on premiums.

Besides, a panel known as Fitment Committee, comprising central and state officials, has proposed to reduce taxes applicable to food delivery platforms to 5 per cent (without input tax credit) from the current 18 per cent (with input tax credit).

The GST Council is a panel of ministers, headed by the Union Finance Minister, responsible for deciding which goods and services are subject to GST and the magnitude of the various rates under the indirect tax regime launched in 2017. The Council serves as the top decision-making body for enacting or modifying any rules pertaining to GST in the country. 

In its last meeting, in September, the GST Council decided on taxes impacting a number of items and services including certain drugs, snacks, auto parts as well as passenger transport via helicopters.