New Delhi: Life Insurance Corporation (LIC) chairman, S B Mathur, yesterday indicated that the corporation's policyholders might not have to pay service tax during the current fiscal.
"It would be pretty difficult to pass on the service tax burden to consumers this fiscal," Mathur said on the sidelines of a FICCI seminar on insurance.
He said LIC was working out the net burden of the 10 per cent service tax and 2 per cent education cess on the risk premium and the impact on the price of its products. "If there is a significant net burden, it may be transferred to policyholders. If it is not substantial, it may be absorbed by LIC," Mathur said.
LIC is eyeing a 35 per cent growth in new premium income this fiscal. "We are currently growing at 60 per cent in terms of new business income. But we are looking at 35 per cent growth during 2004-05.''