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Interim Budget 2019: Budget Expectations Of Salaried Class

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Salaried class has been the most honest taxpayer and so for their sincere contribution they ought to have some expectations from the budget as with other set of individuals and industries. The tax exemption and deductions are only limited as far as the salaried class is concerned.

Interim Budget 2019: Budget Expectations Of Salaried Class
 

There has been also an indiciation that the NDA led UPA govt. will do all its bit to woo the salaried and middle class, "In the last four budgets we have given relief to salaried class as they are the most honest taxpayers of the country. We will do as much as we can this time too within the limitations of the interim budget", said one of the reports.

Increase in basic tax exemption limit to Rs. 5 lakh and section 80C limit to Rs. 2.5 lakh: All eyes are on the budget 2019 and expectations are high on the increase in tax exemption limit to Rs. 5 lakh which may however not be implemented given the pressure on the fiscal deficit front. In all likelihood, the tax exemption limit may be increased to Rs. 3 lakh from the current Rs. 2.5 lakh per annum, meaning those with income upto Rs. 3 lakh will not fall in the tax net.

Also, expectations are to increase the benefit on savings by increasing 80C limit to Rs. 2.5 lakh from the current Rs. 1.5 lakh in a year.

Children education and hostel allowance be increased to meet the real inflation rate: For long as many as 21 years, these allowances have not been revised and now it is expected that these be increased to Rs. 2,000 and Rs. 5000, respectively, for a monthly basis, in accordance with the current rates. The government may consider to include it as part of standard deduction by increasing the base amount.

 

Section 80D limit for medical insurance premium and health check up be increased: Given the burgeoning cost of health care, the benefit of section 80D be increased to Rs. 40,000 also for individuals aged less than 60 years. This will further strengthen the sense to include medical cover in their portfolio apart from being the tax saving investment.

HRA: HRA exemption in the current context is only offered to salaried employed in the 4 metro cities of India. Nonetheless given the increasing employment in other non-metro cities such as Hyderabad, Bangalore, Gurgaon and Pune, the benefit shall be extended there as well.

Motor car value perks: In respect of the perquisite value of the motor car where the vehicle is partly used for official purpose and partly for personal use, the value is arrived at by deducting from the actual expenses Rs. 39,600. But in the case when the vehicle is owned or provided by the employer, the perks allowed is Rs. 39,600. So in a case, when the employee uses his own vehicle, there are expectations of an increase in the deduction amount.

Tax benefits for woman professionals : Sops in respect of deduction in lieu of expenses incurred on services such as opting for day care or crèche facility are looked upon by women professionals who spent heftily on this segment.

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