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2018-19
EXPECTATIONS
1 0 R E C O M M E N D AT I O N S F O R T H E C B D T I N
R E S P E C T O F P E R S O N A L TA X AT I O N M AT T E R S
BUDGET EXPECTATION # 1
• Salaried persons are allowed to claim tax exemptions for the Leave
Travel Allowance received by them from their employer if they go on
vacation anywhere within India. This exemption is still allowed only for
vacations within India.
• In the last 18 years, cost of medical treatment has increased manifold but
exemption limit has never been revised. It is recommended that the
exemption limit on medical expenses should be raised to at least Rs.
50,000 per annum.
BUDGET EXPECTATION # 3
• Section 80C allows deduction of up to Rs.1,50,000 in respect of
payment for life insurance policies, repayment of housing loan, PPF,
children’s education expenses, so on and so forth.
• The threshold limit under this section in only Rs.1,50,000 which
generally gets exhausted and very little money is left for investment in
other schemes.
• Therefore, it is recommended that maximum deduction under Section
80C should be increased to Rs.2,50,000.
BUDGET EXPECTATION # 4
• The amount invested in FD with a maturity of 5 years or more qualifies
for deduction under Section 80C. Interest received on such FDs is
charged to tax in the hands of the investor.
• Since many banks have substantially reduced the rates of interest on FDs,
the net return on investment after taxes is inadequate.
• Therefore, interest accruing on FDs up to reasonable threshold limit
should be exempted from income-tax.
BUDGET EXPECTATION # 5
• From the last four years, basic exemption limit has remained same, i.e.
Rs. 2.50 Lakhs.
• There are various expenses that an employee incurs during the course
of his employment for which no deduction is available to him. As per
return filing statistics, maximum number of returns have been filed in
Form ITR 1, which is generally used by salaried persons and pensioners
to file their annual return of income.
BUDGET EXPECTATION # 8 (CONTD.)