We Expect a Woman-Friendly Budget: ASSOCHAM
In order to help salaried income households and encourage more women to join the work force, the Finance Minister Mr Arun Jaitley should announce a 10-fold increase in children education allowance and tax exemption for crèche facility in the Budget, the ASSOCHAM has said.
In its pre-Budget recommendations to the Finance Ministry, the chamber has made out a strong case for the re-boot of the consumer demand that will bring in vibrancy in the economic cycle of demand leading the investment and employment.
“While we are confident about a positive multiplier effect of the leaving more money in the hands of the tax payers, a lot of women specific proposals be brought in the Budget so as to empower them economically,” the chamber President Mr Sunil Kanoria said.
In its memorandum to the Finance Ministry, the chamber has made a specific recommendation for allowing exemption for crèche provisions either within the organisation or through specific tie-up through commercial crèche providers. An allowance of up to Rs 2,500 per child every month for up to two children may be provided for.
“To supplement household income, more women are entering the job market. With increased phenomenon of nuclear families, working women need support in terms of care of young children while they are at work. Hence to encourage increase in the women workforce, it is desirable that a specific provision be introduced for allowing exemption for crèche provisions,” the ASSOCHAM memorandum on direct tax recommendations stated.
As has been repeatedly pointed out by the Reserve Bank of India, increasing cost of health and education are pinching the pockets of the households, particularly those in the salaried earning bracket. In this backdrop, children education allowance must be enhanced by the income tax laws along with being liberal with expenses on health insurance and medical reimbursements.
The chamber has recommended that let the children education allowance exemption limit go from the present Rs 100 to Rs 1,000 per month. Likewise, the hostel expenditure allowance which is presently exempt up to Rs 300 pm per child for maximum of two children be increased to Rs 3,000 pm.
“The limit for children education allowance is too low as compared to the prevailing school fee and was fixed in FY 1988-99. Also, the limit hostel expenditure allowance as also fixed in 1988-89,” it said.
A similar situation exists with regard to medical expenses reimbursed by the employer. It is exempted to the extent of Rs 15,000 per annum. This limit was also fixed 17 years ago and needs to be revised significantly, at least to Rs 50,000 per annum. Besides the provision should also be made applicable to the retired employees.