SBI favours hike in tax exemption limit to Rs 3 lakh

New Delhi, January 22 

With rise in personal disposable income post 7th Pay Commission, the income tax exemption limit needs to be raised by Rs 50,000 to Rs 3 lakh, a SBI report said on Monday. The move will benefit around 75 lakh people, it said.

The SBI’s Ecowrap report further said if the exemption limit of interest payments under housing loan is increased to Rs 2.5 lakh for existing home loan buyers, from Rs 2 lakh now, it will benefit 75 lakh home loan buyers and cost the government just about Rs 7,500 crore.

“Due to 7th pay commission, the personal disposable income has been increased, so we believe there is a need to raise the exemption limit to Rs 3 lakh. Due to such increase in limit, around 75 lakh taxpayers will be exempted from income tax,” said the report — ‘Union Budget: If wishes were horses!’. — PTI