Union finance minister Nirmala Sitharaman is likely to meet her state counterparts on December 21-22 for pre-budget consultations and the meeting of the GST Council, an official said.

The meeting assumes significance as state finance ministers would present their recommendations for 2025-26 budget to be unveiled on February 1, 2025.

The 55th GST Council meeting would be held during one of these two days in which the much awaited decision on exemption or lower GST rate on health and life insurance would be taken.

The council may also take up some rationalisation exercise and reduce tax rates on a host of common items from 12 per cent to 5 per cent as per the recommendations of a panel of state ministers.

The two-day meeting is slated to take place in Rajasthan, either in Jaisalmer or Jodhpur, the official added.

Last month, the group of ministers (GoM) on health and life insurance GST broadly agreed on exempting insurance premiums paid for term life insurance policies, and senior citizens' health insurance from GST.

Also, GST on premiums paid by individuals, other than senior citizens, for health insurance with coverage of up to ₹5 lakh is proposed to be exempted. However, 18 per cent GST will continue on premiums paid for policies with health insurance cover of over ₹5 lakh.

The GST Council in its 54th meeting on September 9 had tasked the GoM to finalise the report on GST levy on insurance by October-end.

Separately, the GoM on GST rate rationalisation has also suggested that the GST Council rejig tax rates on a host of goods, including packaged drinking water, bicycles, exercise notebooks, luxury wrist watches and shoes. This rate rejig is expect to result in revenue gain of about ₹22,000 crore.

On the other end, luxury items like shoes priced over ₹15,000 and wristwatches above ₹25,000 may see GST hikes from 18-28 per cent.