06 Jul Indian Insurance Sector’s Expectations for Budget 2024: Tax Reforms & Policy Adjustments
In anticipation of Budget 2024, the Indian insurance sector is hopeful for significant tax reforms and policy adjustments to enhance accessibility and appeal of insurance products nationwide. Insurers, particularly focusing on life coverage, are advocating for tax relief on annuities and a reduction in the goods and services tax (GST) applied to their offerings.
Experts emphasize the critical role of tax benefits in expanding insurance penetration. They propose revisions to Section 80C of the Income Tax Act to increase the limit for insurance premium payments, aiming to encourage more individuals to invest in insurance for broader coverage and financial security.
In Budget 2023-24, the removal of tax-free status on maturity proceeds from traditional endowment policies was a setback for many insurers. They now seek potential relaxations in this area.
Key expectations from the insurance sector for Budget 2024 include:
- Increasing tax exemption limits on health insurance premiums.
- Introducing tax incentives for insurance on electric vehicles (EVs) and cyber insurance for small and medium businesses.
- Extending tax benefits under Section 80-D to cover more categories such as senior citizens and specific disease groups.
- Aligning annuity and pension products with the National Pension Scheme (NPS) for additional tax deductions.
- Lowering GST rates on health insurance policies to make healthcare more affordable.
Industry leaders stress the importance of these measures in achieving broader financial inclusion and bolstering the insurance sector’s contribution to national development goals.
Source: Business Today
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