This document summarizes the Indian government's response to a question in Lok Sabha regarding the potential reduction of Goods and Services Tax (GST) on Life Insurance Corporation (LIC) premiums. As of August 4, 2025, the matter is under consideration. The GST Council, a constitutional body, discussed the issue of GST on health and life insurance in its 54th meeting on September 9, 2024. The council decided to form a Group of Ministers (GoM) to comprehensively examine the GST implications on life and health insurance. This GoM is convened by Sh. Samrat Choudhary, Hon'ble Deputy CM, Bihar. During the 55th GST Council meeting on December 21, 2024, the GoM requested additional time to finalize its recommendations. The GST Council has granted this extension. Final recommendations from the GoM are pending. The response was provided by Shri Pankaj Chaudhary, Minister of State in the Ministry of Finance.
Key Entities Referenced
Goods and Services Tax: A value-added tax levied on most goods and services sold for domestic consumption.
LIC Premium: Premium payments for Life Insurance Corporation of India policies.
GST Council: A constitutional body in India comprising members from the Union and State/UT Governments that makes recommendations on GST rates and exemptions.
Ministry of Finance: The ministry responsible for financial matters of the Government of India.
Pankaj Chaudhary: Minister of State in the Ministry of Finance.
Group of Ministers GoM: A committee constituted by the GST Council to examine issues related to GST on life and health insurance.
Samrat Choudhary: Hon'ble Deputy Chief Minister of Bihar and Convener of the Group of Ministers GoM on Life and Health Insurance.
Bihar: A state in eastern India.
New Delhi: The capital of India, where the 54th GST Council meeting was held.
Jaisalmer: A city in Rajasthan, India, where the 55th GST Council meeting was held.
Rajasthan: A state in northern India.
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
DEPARTMENT OF REVENUE
LOK SABHA
UNSTARRED QUESTION NO. 2383
TO BE ANSWERED ON MONDAY, AUGUST 04, 2025/ SRAVANA 13,
1947(SAKA)
REDUCTION OF GST ON LIC PREMIUM
2383. SHRI ADHIKARI DEEPAK DEV:
Will the Minister of FINANCE be pleased to state:
(a) whether the Government has any plans to reduce GST on LIC
Premium;
(b) if so, the details thereof;
(c) whether any decision has been taken in the meeting of GST Council
on this issue; and
(d) if so, the details thereof?
ANSWER
MINISTER OF STATE IN THE MINISTRY OF FINANCE
(SHRI PANKAJ CHAUDHARY)
(a) to (d): GST rates and exemptions on all services and goods are
prescribed on the recommendations of the GST Council which is a
Constitutional body comprising of members from both the Union and
State/UT Governments.
The issue of GST on health and life insurance was placed before the GST
Council in its 54th Meeting held on 9th September 2024 at New Delhi. After
detailed deliberations, the GST Council recommended to constitute a
Group of Ministers (GoM) to holistically look into the issues pertaining to
GST on life insurance and health insurance. Accordingly, a Group of
Ministers (GoM) on Life and Health Insurance was constituted under the
Convenorship of Sh. Samrat Choudhary, Hon'ble Deputy CM, Bihar.
During the 55th meeting of the GST Council held on 21st December 2024 in
Jaisalmer, the Convener of the Group of Ministers (GoM) on Life and
Health Insurance sought more time for finalizing the GoM’s
recommendations and placing the same before the GST Council. The
Council agreed to give more time to GoM to finalize its recommendations.
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