Tuesday, 10 June 2014

Raising of exemption limit for Income Tax and exemption of all allowances from Income Tax: NC JCM writes to Finance Minister

Raising of exemption limit for Income Tax and exemption of all allowances from Income Tax: NC JCM writes to Finance Minister

 Raising of exemption limit of Income Tax to Rs. 5 lakh for Individuals, Rs. 7 lakh for Senior Citizens above 60 years and Rs. 10 lakh for the very old and exemption of all allowances from Income Tax – Com. Shiva Gopal Mishra Secy/NC JCM writes to Finance Minister for including this demand into Union Budget

Shiva Gopal Mishra
Secretary
National Council (Staff Side)
Joint Consultative Machinery
for Central Government Employee
13-C, Ferozshah Road, New Delhi - 110001
No.Nc-JCM/2014/IT
Dated: June 9, 2014
Shri Arun Jaitley,
Hon’ble Minister of Finance,
Ministry of Finance,
North Block, New Delhi

Resp. Sir,

Sub: Raising of exemption limit for Income Tax and exemption of all allowances from Income Tax

Exemption limit from Income Tax is very low and neither realistic nor justified. It is not linked with Inflation nor is it appropriately revised every year.

Fixing of exemption limit for Income Tax is done arbitrarily. No systematic norms are followed while fixing the same. There is no transparency about the norms or policy adopted for fixing the Exemption limit for Income Tax.

Low ceiling of exemption is one of the root cause of build up of huge amounts of Black Money.

It is also a major impediment in the growth and development of the National economy as the spending by the common man gets restricted due to the low ceiling of Income Tax. This, according to experts, adversely affects the National Development as a whole.

Taxing of Dearness Allowance, House Rent Allowance and Transport Allowance etc., erodes the real income of the Salaried Class, as these Allowances are compensatory in nature and as such should be exempted from Income Tax, as recommended by the Fifth Central Pay Commission(vide Chapter 167 of their Report).

Taxing of Pension of Senior Citizens, especially Additional Pension of the very old Senior Citizens, is totally unjustified, and as such should be exempted from Income Tax, as recommended by the Fifth Central Pay Commission.

It is, therefore, requested that:-

(i) Exemption limit for Income Tax be raised to Rs. 5 lakh for Individuals, Rs. 7 lakh for Senior Citizens above 60 years and Rs. 10 lakh for the very old - above 80 years of age.

(ii) All the allowances, i.e. Dearness Allowance/Dearness Relief, HRA and Transport Allowance, may please be exempted from the Income Tax to avoid erosion of real wages as recommended by the Fifth Pay Commission vide Chapter 167 of their Report and Para 95 of Summary of Recommendations (Please see excerpts of Fifth CPC Report attached herewith as Annexure).

(iii) Fixed Medical Allowance to Pensioners may please be exempted from Income Tax as it is reimbursement of the expenses for day-to-day medical treatment.


Yours faithfully,
Sd/-
(Shiva Gopal Mishra)
Secretary(Staff Side)
NC/JCM
Encl: Excerpts of the recommendations of Fifth CPC

Copy to: All Constituent Organizations of the National Council, JCM(Staff Side) - for information.

ANNEXURE

EXCERPTS FROM THE REPORT OF FIFTH PAY COMMISSION REG. EXEMPTION OF ALL ALLOWANCES FROM INCOME TAX

The Fifth Pay Commission vide Chapter 167 & Para 95 of Summary of Recommendation had recommended as under:-

“Para 95 The Commission has felt that the salaries and pensions recommended by it are not really adequate if they are to be fully taxed. Accordingly, it has recommended that all Allowances and Pensions should be paid Net of Taxes”.

The Fifth CPC in Para 167.7 had observed as under:-

‘‘If such Allowances are taxed, then either the Basic Salary gets eroded in its real value from Year to Year or the partial Reimbursement of Expenditure incurred on certain items becomes less and less with the passage of time.  In both the cases, the objective of giving Allowances is partially nullified”.

The Fifth CPC further observed in Para 167.8 that -

“We have observed that Ministry of External Affairs pays ‘Net of Tax’ Salaries to its employees on Foreign Posting. Provision for paying Net of Tax Salary already exists Under Sec.195A of the Income Tax Act. Under the Section, employees do not have to pay Income Tax on the salaries received by them and it is the liability of the employer to pay the same to the Income Tax Department.”

“The solution to the problem of the Central Government Employees in general lies in the application of this legal provision” (Fifth CPC - Para 167.9).

Source: http://ncjcmstaffside.com/2014/raising-of-exemption-limit-of-income-tax-exemption-of-all-allowances-from-income-tax/

Revision of Medical Reimbursement Claim (MRC) Form for CGHS beneficiaries - reg.

New Medical Reimbursement Claim (MRC) Form for CGHS beneficiaries. The Medical Reimbursement Claim Form has been reviewed and further simplified. Separate forms have been developed for serving beneficiaries and pensioner beneficiaries with requirement of minimum information required for processing of the claims. CGHS Order:-

No.S. 11011/9/2012-CGHS (P)
Government of India
Ministry of Health & Family Welfare
CGHS (Policy)
Nirman Bhawan, New Delhi
Dated the 5th June, 2014
OFFICE MEMORANDUM
Sub:- Revision of Medical Reimbursement Claim (MRC) Form for CGHS beneficiaries - reg.
The undersigned is directed to state that it has been the constant endeavour of the Ministry of Health & Family Welfare to improve the facilities under CGHS and simplify / liberalize the procedures to make the Scheme user friendly.
2. In furtherance of the above objective, the Medical Reimbursement Claim Form has been reviewed and further simplified. Separate forms have been developed for serving beneficiaries and pensioner beneficiaries with requirement of minimum information required for processing of the claims. The CGHS beneficiaries are required to submit their medical reimbursement claims in the prescribed forms with requisite documentary evidences to their Department / office or CGHS, as the case may be for further processing and settlement as per approved CGHS rates and guidelines.
3. The following forms have been prescribed:

Form MRC(S) - For Serving CGHS beneficiaries,
Form MRC(P) - For Pensioner CGHS beneficiaries.

Specimen Forms are enclosed
Encl: As Above
sd/-
[V.P. Singh]
Director
Click on following images to save or view:-
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Medical Reimbursement Claim Form for Serving Employees Page 1

medical+reimbursement+claim+form+for+employees+page2
Medical Reimbursement Claim Form for Serving Employees Page 2

medical+reimbursement+claim+form+for+pensioner+1
Medical Reimbursement Claim Form for Pensioner Page 1

medical+reimbursement+claim+form+for+pensioner+2
Medical Reimbursement Claim Form for Pensioner Page 2

medical+reimbursement+claim+form+annexure
Medical Reimbursement Claim Form Annexure-I

medical+reimbursement+claim+form+annexure-II
Medical Reimbursement Claim Form Annexure-II

Source: http://msotransparent.nic.in/writereaddata/cghsdata/mainlinkfile/File692.pdf

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