Employers may soon claim GST input tax credit on employee insurance premiums

The GST Council is preparing to review a proposal that would permit employers to claim input tax credit on insurance premiums paid for their employees. Currently, businesses cannot claim ITC on group insurance policies purchased for workforce coverage, with an 18 percent GST levied on these premiums.

The move aims to reduce the tax burden on employers and lower overall business expenses related to employee benefits. The proposal will be placed before the GST Council for consideration in an upcoming meeting.