homepersonal finance NewsNo relaxation yet on Rs 5 lakh insurance premium limit announced in Budget speech
No relaxation yet on Rs 5 lakh insurance premium limit announced in Budget speech
During the Budget speech, the finance minister announced that the government will not provide any tax exemption on maturity benefit if the aggregate annual premium paid by an individual is above Rs 5 lakh for a life insurance policy, which is issued on or after April 1, 2023.
CNBC-TV18 has learnt that the government has not drawn up a proposal to raise Rs 5 lakh insurance premium limit, which was introduced in the Budget 2023, from April 1.
During the Budget speech, the finance minister announced that the government will not provide any tax exemption on maturity benefit if the aggregate annual premium paid by an individual is above Rs 5 lakh for a life insurance policy, which is issued on or after April 1, 2023.
This proposal has sent jitters in the life insurance community and that is why the Life Insurance Council is now seeking time from the finance ministry to meet the officials to try and build up a narrative that this proposal of the Budget needs to be diluted.
When CNBC-TV18 crosschecked about it with the top government officials, they said a particular meeting has been sought by Life Insurance Council of India, but there is no proposal that has been drawn, there are no deliberations that are going on. This meeting is yet to be scheduled. They have been informally told that the government is okay to meet you, but whether this will lead to anything. Well, people in the know indicated nothing as of now because government is very clear in its thinking that this particular move, if at all is diluted will only benefit the rich, which is not the idea of the government and government feels that those who can afford to pay a premium of Rs 5 lakh per annum or more do not require any tax exemption.
Also Read | Budget 2023 | Proposal to tax returns on life insurance purchases beyond Rs 5 lakh disappoints analysts
watch the accompanying video of CNBC-TV18’s Timsy Jaipuria for more details.
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