Government Urged to Increase Health Expenditure and Other Allowances
Healthcare Cost Relief: Over the past 5-6 years, inflation has significantly increased either on food items or healthcare expenses. The Finance Minister is well aware of the rise in health insurance premiums. Generally, healthcare costs have more than doubled in the last 5-6 years. The number of people seeking treatment through loans has been consistently increasing. Therefore, medical expenses under Ayushman Bharat could be increased, currently capped at ₹5 lakh. Under the old system, Section 80D allows a tax deduction of up to ₹25,000 for health insurance premiums paid for their family. However, if you are over 60 or your parents are over 60, the limit is up to ₹50,000, on which you will receive a tax cut. The good news is that this discount is separate from the discount available under Section 80C. Senior citizens who do not have health insurance can claim a discount of up to ₹50,000 on their medical expenses. Given the rise in healthcare costs, there is an urgent need to increase the discount of 100% available under Section 80D. For preventive health check-ups, you get a discount of up to ₹5,000 in tax, which is very low. It needs to be increased to at least ₹15,000. Additionally, this expense is currently covered under Section 80D. There is a need to keep this expense separate from Section 80D.
NPS Increased Limit: After retirement, the government has started the National Pension System (NPS) plan to provide pensions. In NPS, a tax exemption is given on an annual investment of up to ₹50,000. But even after running this plan for the full period, such an amount is not accumulated, which can cover the necessary expenses after retirement. To increase the utility and popularity of this plan, it is necessary to increase the investment limit to ₹1 lakh annually.
EV Subsidy: The subsidy available on electric vehicles (EVs) ended on March 31, 2024. In the interim budget, the government made provision for the fund for FAME-3, but nothing was said about its rules and conditions. The FAME program aims to encourage electric vehicles by providing financial assistance for the purchase of EVs so that the popularity of these vehicles can be increased. However, the economic support amount in FAME-3 has been reduced compared to FAME-2. It is expected that a detailed announcement will be made about FAME-3 in the full budget. A provision of ₹1.5 lakh was made for the subsidy on interest payments on loans for buying electric cars, but this discount was only for loans received from January 1, 2019, to March 2023. The government has not extended the period of this discount. The finance minister should be aware of this discrepancy.
HRA Limit in Metros: After the COVID pandemic, there has been an unexplained increase in rents in major Indian cities. Currently, only 50% of the house rent allowance (HRA) is available on rented accommodation in metros like Delhi, Kolkata, Mumbai, and Chennai. It is surprising that big cities like Bengaluru are not included in the list. The residents of the national capital region or the metropolitan area of Mumbai, such as Noida, Gurugram, Faridabad, Navi Mumbai, Thane, are not included in the 50% HRA limit. In cities like Ahmedabad, Surat, and Kanpur, the HRA limit is not 50%, while everyone knows that millions of people in metropolitan areas like Delhi or Mumbai go to work. The finance minister should be aware of this discrepancy.
