Budget – Jaitley announces relief to Senior Citizens

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New Delhi : Union Finance and Corpoate Affairs Minister Arun Jaitley, in his budget speech on Februart 1, 2018, announced relief to Senior Citizens. Exemption of interest income on deposits with banks and post offices are proposed to be increased from Rs 10,000 to Rs 50,000. TDS shall not be required to be deducted under section 194A. Benefit will also be available for interest from all fixed deposit schemes and recurring deposit schemes.  Hike in deduction limit for health insurance premium and/ or medical expenditure from Rs 30,000 to Rs 50,000 under section 80D was also proposed.

Jaitley announced increease in deduction limit for medical expenditure for certain critical illness from Rs 60,000 (in case of senior citizens) and from Rs. 80,000 (in case of very senior citizens) to Rs 1 lakh for all senior citizens, under section 80DDB. Concessions will give extra tax benefit of Rs 4,000 crore to senior citizen. It is also proposed to extend the Pradhan Mantri Vaya Vandana Yojana up to March, 2020. The current investment limit is also proposed to be increased to Rs 15 lakh from the existing limit of Rs 7.5 lakh per senior citizen, according to a PIB release.

In order to take care of the education and health care needs of Below Poverty Line (BPL) and rural families, the Budget proposes to increase the cess on personal income tax and corporation tax to 4 percent from the present 3 percent. The new cess will be called the “Health and Education Cess” and is expected to lead to a collection of an estimated additional amount of Rs 11,000 crore.

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