Insurance companies are liable to pay ₹20,000 crore for GST violation: DGGI

The Directorate General of GST Intelligence (DGGI) has found insurance companies violating GST rules. Anil Kumar Gupta, Principal DG of DGGI, told CNBC-TV18 that these companies have not been paying GST on services provided to employees in SEZ (Special Economic Zone) units.

He clarified that this service is not exempted from GST.

Gupta noted that while some insurance companies have been paying GST in certain cases, others have failed to comply.

"This is a clear violation of GST rules," he said.

As a result, general insurance companies are now facing a total GST liability of approximately ₹20,000 crore.

The DGGI has already issued notices to these companies after conducting detailed investigations.

Gupta also highlighted that this issue is not covered under the recent clarifications issued for the insurance sector during the 53rd GST Council meeting.

Insurance firms now face significant penalties as they work to rectify their tax compliance issues.