Make health insurance mandatory for employees
We are extremely hopeful that in the coming Budget, the Government will suitably offer a boost to the non-life insurance sector and play a pivotal role in enhancing the penetration of health insurance in our country
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Move to boost health insurance penetration and allow input tax credit to be claimed
The recent pandemic continues to influence the world and all people in many unprecedented ways. Amongst other aspects, the need for health insurance has gone up with people increasingly perceiving health insurance as a necessary investment to be made. While the insurance premium payments constitute admissible deductions from income for tax payers, enhancing the extent of eligible deduction by at least 50 per cent vis-à-vis the current levels, would go a long way in further improving the penetration of health insurance in the country.
The global pandemic necessitates a health insurance cover being made mandatory for employees in order to protect them. Accordingly, we believe that it would a great fillip from a health insurance penetration standpoint, to allow input tax credit to be claimed with respect to the GST charged on health insurance premiums paid by corporate while purchasing group health insurance covers, which is currently unavailable as per the current GST laws in force.
It would further be a huge fillip by the Government if the tax deduction limit available towards health check-up can be suitably enhanced to factor in the prospect of an individual having to incur a cost towards getting himself/herself vaccinated, as a preventive measure for avoiding the contraction of the Covid-19 pandemic diseases.
The insurance covers would not only protect the citizens and taxpayers against adversities, but also help them reduce their taxation burden. India has a young insurable population and the incentives on policy purchase by the government, would a long way in ensuring that the citizens continue to witness greater disposable incomes, either from business and profession or salary, as their spending on health issues, hospitalisation scenarios and ailments suffered, would reduce due to the presence of a health insurance cover which appropriately takes care of the medical expenses. Availability of greater disposable income and consequent spending by consumers would also play a crucial role in ensuring that the exchequer witnesses improved collection of revenue through indirect taxes.
We are extremely hopeful that in the coming Budget, the Government will suitably offer a boost to the non-life insurance sector and play a pivotal role in enhancing the penetration of health insurance in our country.
(The author is CFO of ICICI Lombard General Insurance)
