Will there be more tax exemption on health insurance?
Will there be more tax exemption on health insurance? The complete budget for the fiscal year 2024–2025 has been made public. The Lok Sabha's budget session will begin on July 22. The comprehensive budget will be presented by Finance minister Nirmala Sitharaman the following day, on July 23. The expectations of the general public and different industries are growing as the dates for the entire budget approach. One of the main demands for the budget is the expansion of income tax deductions on health insurance premiums.This level of tax exemption is currently offered.The Modi administration has been asked by insurance companies to raise the tax exemption on health insurance premiums. One may deduct up to Rs 25,000 from their health insurance premium under Section 80D of the Income Tax Act. Senior citizens are subject to a ceiling of Rs 50,000.Call for raising the exemption threshold to this levelExperts in the insurance sector have reportedly requested that the section 80D tax exemption be raised to Rs 50,000 for individuals, or those under the age of sixty, according to a Mint article. A similar demand has been made to raise the elderly citizen's deduction cap from Rs 50,000 to Rs 75,000. They contend that by raising the premium deduction cap, older people will enroll in appropriate coverage, which will pay for rising healthcare costs.How can one obtain health insurance that is tax-exempt?When you file a claim under section 80D, the premium you paid for your health insurance is subtracted from your income, lowering your taxable income. A lower taxable income results in a lower tax obligation. Assume you have an income of Rs 8 lakh and have paid a premium of Rs 20,000 for health insurance. Your taxable income will drop to Rs 7.80 lakh as a result of the deduction, and tax will only be assessed on that amount rather than Rs 8 lakh. The benefit of section 80D is currently available under the previous tax system. It has long been demanded that it be included in the new tax system.