HYDERABAD: Deputy Chief Minister and Finance Minister Mallu Bhatti Vikramarka suggested that the GST rate on health insurance premiums for all age groups be reduced from 18 per cent to five per cent.
He attended the GST Council meeting chaired by Union Finance Minister Nirmala Sitaraman in New Delhi on Monday. Principal Secretary of Revenue Department SAM Rizvi accompanied him.
Vikramarka also proposed exemption for health insurance premiums for senior citizens. He stressed the need for reduction or exemption on health insurance premiums on the grounds that access to quality healthcare of their choice is to be ensured to the middle and lower middle class groups owing to high medical expenses. He further stated that it would be the responsibility of the “people’s government” to make health insurance affordable to all.
During the meeting, he made several proposals, including exemption of GST on research grants or donations received from the government or private agencies.
Further, on the issue of compensation cess, he observed that after discharging the loan amount, it would be appropriate to add cess component to the SGST component, as the purpose of compensation cess was to strengthen the finances of the states. He also suggested that a Group of Ministers (GoM) be constituted to examine this issue and recommend the future course of action. Vikramarka also volunteered to be a part of the Group of Ministers.
On the subject of recovery of excess ad hoc IGST apportionment made earlier, the deputy CM informed the Council that the ad hoc apportionment was done to the Telangana at 4.02 per cent of the total apportionment (based on the revenues for the FY 2015-16), but it is proposed to recover now at 5.07 per cent based on another formula. Hence, he suggested that a Committee of Officers (CoO) be constituted to look into the matter and submit a detailed report for arriving at a formula to make recoveries from the states.
The Council referred the matter to a CoO with directions to submit its report within one month so that the same would be discussed and an appropriate decision be taken in the next GST Council meeting.