Budget 2018: The Modi government’s mega fifth budget will be presented on February 1. Budget 2018 Expectations are rising. Industry bodies and aam admi are hoping that great things will come out of the iconic brief-case of Finance Minister Arun Jaitley. Income tax exemption related announcements will surely grab all the eyeballs. “Under section 17 of the Income tax Act, medical reimbursements to employees are exempted from tax up to Rs.15,000 per annum. Further, the expenditure incurred by the employer for the medical treatment of the employees and his family in approved hospitals is also not treated as a perquisite in the hands of the employee,” The Institute of Chartered Accountants of India (ICAI) said. ICAI, however, says this tax benefit is not available to retired employees. The renowned chartered accountants’ body has suggested the Modi government to address the issue in Budget 2018.
In the Budget 2018, the Modi government should provide income tax exemption on medical reimbursement for retired employees, ICAI has suggested. “The provisions of section 17 be amended to include retired employees for the tax benefit on medical reimbursements /hospitalization expenditure in approved hospitals,” ICAI suggested.
Medical reimbursement is an arrangement under which employers reimburse the portion of the expenses incurred by employees towards their health. The Income-Tax Act, 1961 allows an exemption of up to Rs 15,000 per annum on medical reimbursements paid by the employer, on actual submission of bills by the employee. This limit of Rs 15,000 per annum was revised by Finance Act, 1998 with effect from April 1, 1999. Prior to this amendment, the prescribed ceiling under the Act was Rs 10,000 per annum.
Watch- Probable Income Tax-related announcements in Budget 2018
Experts believe that this limit is outdated and unrealistic and in no way representative of the expenses actually incurred by us on medical treatment, especially in private hospitals. In Budget 2018, Finance Minister Arun Jaitley must revise this limit and a limit which is closer to reality is fixed, experts say.
The date for the Budget 2018 has been announced by the Modi government. The Union Budget 2018 will be presented by FM Jaitley. Notably, the budget 2017 was presented on February 1. This year too, the Modi government has chosen the same date for presentation of Budget 2018. It is likely that FM Jaitley will ‘rise to present’ budget 2018 at noon.
The Budget Session of Parliament is set to commence on January 29. President Ram Nath Kovind will address the joint sitting of the two Houses on January 29. The first phase of the session will be from January 29 to February 9. After a recess, Parliament will meet again from March 5 to April 6. There will be a recess between the session so that the department-related standing committees can clear the budgetary proposals related to their respective ministries.