The Securities and Exchange Commission of Pakistan (SECP) is advocating for a new tax benefit in the upcoming budget: tax credits for people who buy life and health insurance. This move aims to make insurance more affordable and accessible for a wider range of Pakistanis.
Why This Matters:
- Life Insurance: The SECP sees life insurance as a crucial tool for saving and investment, offering financial security for the future.
- Health Insurance: By encouraging health insurance, the government wants to ease the burden on public healthcare services and offer citizens better access to quality care.
- Tax Credit Incentive: A tax credit would essentially reduce your tax bill if you buy approved insurance products.
- Micro-Insurance Included: The proposal goes beyond basic insurance, also considering tax credits for micro-insurance, which caters to low-income earners and small businesses.
Potential Benefits:
- Increased Insurance Uptake: Tax breaks could make insurance more attractive, leading more people to get insured.
- Financial Inclusion: By lowering costs, especially for micro-insurance, more people can access financial protection.
- Economic Stability: A broader insurance base could contribute to a more stable financial system.
- Citizen Well-being: Greater insurance penetration translates to more people being prepared for emergencies and having access to healthcare.
Looking Ahead:
This proposal will be debated during budget discussions. If implemented, it could be a significant step towards a more inclusive financial system in Pakistan. Stakeholders are optimistic about the potential for these measures to increase insurance use and improve the overall well-being of the population.
