Tax collections in the current fiscal may fall short of targets by as much as Rs 2 lakh crore on faltering economy, leaving a very little room for Finance Minister Nirmala Sitharaman for offering any meaningful reduction in personal income tax rates.
From exemption for house rent allowance, to leave travel allowance expectations are wide-ranging from the personal finance sector.
Since higher deductions are allowed for house rent allowance (HRA) if an employee is living in a metropolitan city, there is also a need of inclusion of other cities in this category if an employee pays rent for his residential accommodation as many other cities have come up in the past two decades with employment opportunities.
Employees across various sectors also look up to exemption for leave travel allowance by their employers for purpose of going on a vacation anywhere in India and abroad.
The sector also expects exemptions under tax benefits of sections 54, 54F and 54EC of the Income-Tax Act. As of now the exemptions under these sections are allowed only when an assessee makes investment in some specified assets.