New GST rates: Congress, TMC welcome govt's 'late' revision; Ashwini Vaishnaw, EAM Jaishankar praise decision

Announcing the outcome of the 56th GST Council meeting, Finance Minister Nirmala Sitharaman on Wednesday evening said that all individual life insurance policies whether term life, ULIP or endowment policies and subsequent reinsurance are exempt from GST.

The Goods and Services Tax (GST) Council, during its 56th meeting, decided to revamp the tax structure into a primarily two-rate system as proposed by the Central government. Finance Minister Nirmala Sitharaman's explanation on how the new GST slabs will be beneficial for the common man, has been welcomed by many leaders, including senior Congress leader P Chidambaram.

The GST Council, simplified the indirect tax system into a two-tier structure of 5% and 18% from a four-tier structure of 5%, 12%, 18% and 28%. An additional slab of 40% has been introduced for so-called sin goods and luxury items.

In a post on X late Wednesday, the former Finance Minister and Rajya Sabha MP P Chidambaram welcomed the Centre's recent GST rationalisation and rate cuts but questioned the decision as he questioned the eight year delay in the revision of GST.

"The GST rationalisation and the reduction in rates on a range of goods and services are WELCOME but 8 years TOO LATE. The current design of GST and the rates prevailing until today ought not to have been introduced in the first place. We have been crying hoarse for the last 8 years against the design and rates of GST, but our pleas fell on deaf ears," he wrote on X.

The Trinamool Congress on Wednesday termed the Centre’s decision to exempt life insurance and health insurance from GST a victory for common people, which it claimed was “wrested from a tone-deaf regime that only listens when forced”.

“A victory for common people. A victory wrested from a tone-deaf regime that only listens when forced. From day one, Smt.@MamataOfficial warned the Finance Minister that taxing insurance premiums was cruel, anti-people, and would deter families from securing their future, leaving them vulnerable to financial ruin in times of crisis,” the Mamata Banerjee-led party said in a post on X.

Railways Minister Ashwini Vaishnaw also hailed the decision and stated that the new GST will power PM Modi's vision of "Aatmanirbhar Bharat". Sharing an X post, Vaishnaw wrote - "Historic Next-Gen GST Reforms. PM Narendra Modi Ji's gift for the coming festival season - cutting costs, easing lives, and powering Aatmanirbhar Bharat (self-reliant India)."

In a post on X, external affairs minister Dr S Jaishankar welcomed the new GST rates. Congratulating PM Narendra Modi and Finance Minister Nirmala Sitharaman, the EAM stated that the government's decision would enhance the ease of living and business in the country.

"Delivering on PM Narendra Modi's Independence Day announcement, the GST Council decision to adopt the NextGen GST today will have huge impact on the transformation story underway in India and the Government's effort to improve ease of living & doing business," said Jaishankar.