HEALTH MADE LESS TAXING

GST Council's bold reforms exempt insurance premiums and slash medical taxes, boosting affordability and access nationwide

- By ARYA RAKSHITA

THE GOODS AND Services Tax (GST) Council's September 3 decision marks a watershed in India's healthcare journey. Effective September 22, 2025, health and life insurance premiums will be fully exempt from GST, dropping from 18 per cent to zero. Simultaneously, GST on a wide range of medicines, diagnostics, and medical devices has been reduced to a uniform 5 per cent. Together, these steps promise to ease costs for households, broaden access to care, and boost industry growth.

India's insurance penetration, at 4 per cent compared to the global average of 7 per cent, leaves millions under-protected. Experts say removing GST on premiums will encourage families in tier-II and tier-III cities to embrace insurance. Joydeep Saha, MD & CEO of ManipalCigna Health Insurance, applauded the move: “Exempting GST on health insurance premiums is a critical step forward in making quality healthcare protection accessible for every Indian.” He added that rising medical inflation made such relief essential.

Insurance Boost