During the 55th GST Council meeting held on December 21, 2024, in Jaisalmer, Finance Minister Nirmala Sitharaman announced that gene therapy, recognized as a critical life-saving treatment, has been fully exempted from GST. The decision to reduce GST rates for health and life insurance premiums has been deferred to the next meeting. The Group of Ministers (GoM) on Health Insurance is expected to reconvene, discuss and finalize recommendations regarding GST rates on insurance premiums.
What is Gene Therapy and how would the exemption help?
Gene Therapy involves modifying or manipulating genes within a patient’s cells to treat or prevent diseases, offering potential cures for various genetic disorders and certain types of cancers. Genes are delivered into the patient’s body using vectors, typically viruses that have been modified to be harmless. The vector carries the new gene into specific cells, where the gene integrates with the patient’s DNA and begins producing the necessary proteins. The exemption of GST on gene therapy aims at making it more accessible and affordable for patients requiring such advanced medical interventions. The GST Council’s decision reflects a commitment to reducing the financial burden on patients and promoting access to essential healthcare services. The move is expected to benefit patients by lowering the overall cost of gene therapy treatments, thereby enhancing accessibility to these advanced medical procedures.
GoM to finalize recommendations on insurance in Jan 2025
The GoM recommendations included full exemption on pure term life insurance policies that cover family members, health insurance policies specifically for senior citizens. The GoM had also recommended reducing the GST rate on all individual health insurance policies to 5%. However, a decision was deferred to the next meeting to allow for further clarifications and recommendations from the Group of Ministers (GoM). The GoM is expected to reconvene in January 2025 to further discuss and finalize recommendations regarding GST rates on insurance premiums.
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