NEW DELHI, July 31 (TIWN): In a major jolt for the Narendra Modi Govt, Union Minister Nitin Gadkari urged Finance Minister Nirmala Sitharaman to withdraw the 18 per cent Goods and Services Tax (GST) levied on life and medical insurance premiums, calling it a "tax on the uncertainties of life." In the letter addressed to the Finance Minister, Gadkari said: "Main issue raised by the Union is related to withdrawal of GST on Life and Medical Insurance Premium. Both life insurance and medical insurance premiums attract a GST rate of 18 per cent. Levying GST on life insurance premium amounts to levying tax on the uncertainties of life."

"The Union feels that the person who covers the risk of life's uncertainties to give some protection to the family should not be levied tax on the premium to purchase cover against this risk. Similarly, the 18% GST on medical insurance premium is proving to be a deterrent for the growth of this segment of business which is socially necessary. Therefore, they have urged withdrawal of GST as mentioned above," he added.

The minister noted that the Union has put forth several suggestions, including the provision of Differential Treatment to Savings through Life Insurance policies. Additionally, they have advocated for the reinstatement of Income Tax deductions for health insurance premiums paid by individuals.

Furthermore, the Union has proposed the consolidation of public and sector general insurance companies, with the aim of streamlining operations and improving efficiency in the insurance industry.