Budget Expectations 2018: Insurance Sector Demands Lower GST Rate, 80C Limit Enhancement

By Roshni Agarwal
Subscribe to GoodReturns
For Quick Alerts
ALLOW NOTIFICATIONS  
For Daily Alerts

    Like any other sector insurance sector also suffered the blows due to demonetisation due to which money saw its channnelisation in illegal areas but as the Union Budget 2018 is likely to be a populist budget it pins hopes on section 80 C limit enhancement to atleast Rs. 3 lakh with a separate segment for deductions allowed in respect of insurance premiums, rationalization of GST rates, better investment norms.

     Insurance Sector Demands Lower GST Rate, 80C Limit Increase in Budget 2018

    Here' we discuss each of the proposals by the industry:

    Section 80C limit enhancement with a separate segment for insurance premium deduction:

    To encourage savings and hence purchase of insurance policies, a deduction in respect of premium paid is allowed under Section 80C. Not only this other expenses are also covered as the expenses such as principal towards housing loan, tuition form the part of Rs. 1.5 lakh 80C limit.

    But in its pre-budget expectation, the industry mulls to create a separate 80C limit over and above the current and with a separate head for insurance premium.

    Investment norms for better returns: Last year, the government in its EPS scheme was considering to split into 2 accounts with the new one that provides returns linked to ETFs.

    This year on similar lines, the industry intends to limit exposure in G-securities and instead move the funds to more lucrative equity segment.

    GST rate rationalization: The higher GST of 18% is proving quite burdensome for insurance buyers which previously stood at 15%. The industry expects its rationalistation.

    In the previous service tax was payable only on the risk component of the premium while the investment portion did not levied any tax.

    Now, it is to be seen to what extend the Budget 2018 augurs well for the insurance industry and insurance buyers.

    Goodreturns.in

    Read more about: insurance 80c gst investment
    Company Search
    Enter the first few characters of the company's name or the NSE symbol or BSE code and click 'Go'

    Find IFSC

    Get Latest News alerts from Goodreturns

    We use cookies to ensure that we give you the best experience on our website. This includes cookies from third party social media websites and ad networks. Such third party cookies may track your use on Goodreturns sites for better rendering. Our partners use cookies to ensure we show you advertising that is relevant to you. If you continue without changing your settings, we'll assume that you are happy to receive all cookies on Goodreturns website. However, you can change your cookie settings at any time. Learn more