Middle class wooed with tax exemptions

Sanjeev Sharma

Tribune News Service

New Delhi, February 28

The Union Budget today provided several sops for middle-class taxpayers, including increase in the limit of deduction in respect of health insurance premium from Rs 15,000 to Rs 25,000.

The total deductions allowed are to the tune of Rs 4.42 lakh, Finance Minister Arun Jaitley said. The transport allowance exemption is being increased from Rs 800 to Rs1,600 per month.

However, consumers will get a hit from increase in service tax to 14% as eating out, mobile bills and other services will become expensive. For senior citizens, the health insurance deduction will stand increased to Rs 30,000 from the existing Rs 20,000.

For senior citizens aging 80 or more, who are not covered by health insurance, deduction of Rs 30,000 towards expenditure incurred on the treatment will be allowed. The deduction limit of Rs 60,000 towards expenditure on account of specified diseases of serious nature is proposed to be enhanced to Rs 80,000 in case of very senior citizens. Additional deduction of Rs 25,000 will be allowed for differently abled persons.