What a Retiree Expects From The Finance Ministry

Finance Minister Nirmala Sitharaman will present her fifth straight Union Budget 2023 on February 1. The common man of India has various expectations in terms of income tax slab, GST exemption, and other benefits. The elderly population of the country cannot be ignored in this budget and hence they have something to say.

Increase in old-age pension: The retiree demands the finance ministry to revise their old-age pension on par with inflation. The current share from the centre in the pension should be increased to Rs 3000 every month. Moreover, the state government is also recommended to update its share.

At present, the annuity or pension income of retirees generated via retirement corpus is taxed. Funds collected through NPS corpus and pension policies are taxed. Hence, senior citizens want exemptions from taxes in 2023.

Medical expenses: Retirees who have purchased health insurance policies can claim a tax deduction of up to Rs 50,000 under section 80D on premiums paid. Pankaj Mathpal, Founder of Optima Money Managers, says, “In a country where medical expenses are not completely free even in government hospitals, the government should give 100 per cent deduction for medical expenses without any limit.” Moreover, in health insurance policies, OPD expenses like pharmacy bills, and doctor consultations are not covered.

Tax Deduction: Section 80TTB allows for a tax deduction of up to Rs 50,000 for interest earned on bank and post office savings fixed deposits for senior adults (FDs). This limit should be increased to Rs. 1 lakh, according to Kuldeep Kumar, partner at Vyolto Partners, because of the escalating inflation that depletes people’s savings and meagre sources of income.

Tax Returns: Senior folks, who do not have taxable income, should be allowed to obtain their tax refunds more easily. Given the growing use of technology and data by the Income Tax Department, this is plausible. Seniors over 75 are free from filing income tax returns under Section 194P, providing they exclusively receive a pension and interest income.

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