CHENNAI: The proposed new revenue tax slab charges – decrease charges with none tax cuts – might put some cash within the fingers of taxpayers, however would have an effect on life or common insurance coverage insurance policies and brokers promoting post workplace financial savings gadgets, a high chief mentioned. LIC Agents function the affiliation.
"In India, a life insurance policy is sold and not purchased. It is a social security product. The new tax rates give the tax payer the option to pay tax for tax-saving measures, such as life, health Like buying insurance policies., Or investing in Public Provident Fund (PPF) and others, "PG Dileep, General Secretary, LIC Agents Organization of India. <! –
According to him, the Asian insurance coverage big Life Insurance Corporation of India (LIC) has about 11.89 lakh brokers.
The "bulk of policies sold" quantity to 1 lakh to five lakhs. The proposed tax slab charges might preserve some cash within the fingers of the taxpayer and he can’t purchase a life insurance coverage coverage to save lots of tax. , "Said Dileep.
He mentioned that this is able to make it much more tough for brokers to promote life insurance policies.
"This will be a major setback for insurers as insurance cover is sold and not bought. Taxpayers buy insurance cover – life and health – to save tax outgo. When there is an option, the general human tendency is to buy Is not meant for. " Insurance, ”Chartered Accountant PS Prakash Prabhakar instructed IANS.
Giving precedence to anonymity, a senior insurance coverage trade official instructed IANS, "Health and life insurance policies are mainly bought as a tax-saving measure. Now a disinfectant for a person to buy such insurance cover Seems to put his family at risk. "
Quoting a senior official of a non-public sector life insurer, IANS has been instructed that the insurance coverage penetration, which may be very low in India, will come down additional.
According to Prabhakar, such tax proposals are effective in international locations the place there’s a sturdy social safety system, whereas in India an individual has to rely for himself throughout his previous age. Thus, obligatory tax saving schemes at an early age present social safety throughout previous age.
Prabhakar mentioned that there isn’t a assure that the federal government will proceed with the previous programs and should finish it properly in future.
One answer for policyholders now’s that the federal government has determined to not tax the maturity revenue of the life insurance coverage coverage.
Probably to supply tax deduction for all times insurance coverage below a brand new tax charges by means of media