Moneycontrol
Last Updated : Jan 20, 2017 04:28 PM IST | Source: Moneycontrol.com

Budget 2017: Health insurers should be exempted from MAT provisions

A tax free universal health insurance scheme would encourage all those people who have yet to enter the health insurance market, to consider investing in the scheme to avail of quality healthcare.

Antony Jacob
Apollo Munich Health Insurance

The Indian industry is looking at the upcoming Union Budget 2017-2018 with a keen sense of hope and confidence that the government will aid all businesses to grow to augment the country’s economic growth.

The government is expected to launch a universal health insurance scheme this year. We hope that the government develops this as a non-taxable service, to enable the scheme to grow exponentially, resulting in a rapid boost for the penetration levels. A tax free scheme would encourage all those people who have yet to enter the health insurance market, to consider investing in the scheme to avail of quality healthcare.

Another hope we have for this year’s union budget is the move to reduce service tax/GST on health insurance services to benefit those seeking to purchase health insurance in the upcoming fiscal. The 15% service tax levied in last year’s Budget has been a deterrent to those considering the purchase of health insurance due to higher outgo. We hope that the Finance Ministry considers a reduction in the service tax/GST to enable more penetration of health insurance covers including standalone OPD coverage, single disease covers.

To enable protection against contingencies to the lakhs of Indian travellers, we also propose that travel insurance be included in the insurance exemption under The Income Tax Act Section 80D. This would help people to buy travel insurance to avoid health issues during travel, baggage losses and potential travel cancellations/postponements which create difficulties to those away from home.

We hope that the Finance Ministry offers relief for non-life insurance companies, especially health insurance companies, with regards to the Minimum Alternate Tax slabs. High medical inflation and increased distribution costs place large financial pressures on insurers, and hence we seek exemption from MAT for general insurance companies including standalone health insurance companies.
First Published on Jan 20, 2017 04:28 pm
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