Is It Possible To InIclude Your GST Number In Your Car Insurance Policy?
Published On May 10, 2022 11:00 AM By InsuranceDekho
Is it possible to include your GST number in your car insurance policy? Learn how to include your GST number in your auto insurance policy.
The GST is a unified tax system in which the Indian government charges and collects taxes from state governments on the supply of goods and services, including central excise duty, interstate sale of products, service tax, value-added tax, entry tax, luxury tax, and purchase tax. For vehicle insurance, which falls under the services category of GST, the sale of goods and services is taxed at a fixed rate of 18 percent. As a result of the GST, the cost of motor insurance has increased by 3%, and policyholders are paying a little higher premium to offset the expense. This is only one aspect of how the GST has affected auto insurance, but it is a significant one. We'll look at how it has affected auto insurance throughout time in this piece.
Do You Need To Include Your GST Number In Your Car Insurance Policy?
Yes, your GST number can be included in your motor insurance policy. To get the GST number added to your car insurance policy, just phone the customer service department of your motor insurance provider or an insurance broker. You may add your GST number to your auto insurance coverage. Simply call the customer service department of your motor insurance provider or an insurance broker to get the GST number added to your vehicle insurance policy. The GST Act's implementation streamlined and standardized the whole indirect tax structure.
Effect of the Goods and Services Tax (GST) on Car Insurance Policies
The table below shows how the GST has affected automobile insurance policies:
Increase in the Service Tax
Automobile insurance has been exposed to a higher service tax since the establishment of the GST. The service tax was formerly 14 percent, plus 0.5 percent Krishi Kalyan cess and 0.5 percent Swachh Bharat cess. This service tax rate has now been raised to 18%, resulting in an overall tax rate increase of 3%. Even when inflation and other factors are taken into account, this has had a considerable impact on premium rates.
Vehicle insurance rates may be higher as a result of the GST than they were previously. Automobile insurance plans are now required to pay GST, and the rate of service tax for vehicle insurance has also been hiked to account for the increased computation and administrative costs. The service tax on automobile insurance premiums was formerly 15%, however, it has lately been raised to 18%. The amount of premium that future auto insurance customers will have to pay has increased in tandem with the amount of tax.
Increases the Number of Options Available
Many automobile insurance providers are now offering more features at a higher price as a result of the GST's inclusion of auto insurance. A range of additional services is now available, including increased coverage, online savings, and improved client management. In addition, in order to improve customer service, numerous automobile insurance firms provide a cashless garage service to their clients.
The most important consequences of the GST on automobile insurance coverage are listed below. While you may have to pay a higher price for vital services, remember that with a higher price comes better services that you didn't have before. Due to the high cost of vehicle insurance, it is not a smart idea to avoid getting it. When you buy a car, you should ensure it since it will offer you consistent financial stability in the event that the vehicle's body or parts are damaged.
Also read - Everything You Need to Know About Car Insurance's Compulsory Personal Accident Coverage