The provisions for the budget 2018-19 are in progress. Expectations and suggestions have been made during Pre-Union-Budget –Meet chaired by PM Modi. Meanwhile, it is also expected that Finance Minister Arun Jaitley can motivate people to save and invest in this final budget of Modi-led-Govt. In this budget, Modi Government can boost the tax exemption on income tax under Section 80C, along with the exemption of income tax slab for salary-classed-sector. The government can hike it from existing limit 1.5 lakh to 2 lakh rupees.

Here are Key points of Pre-Union-Budget -Meet

Recently held a Pre-“Union-Budget -Meet with the Finance Minister Arun Jaitley  , senior officials of banks and financial institutions have proposed that tax exemption limit should be of Rs 80 lakhs to two lakhs under section 80C. So that people could invest more and focus on savings at the domestic level.

 Modi-led –Govt  will focus to encourage people for investing more

Prior to this, the exemption received on investment under Section 80C was made from Rs. 50 thousand to 1.5 lakh rupees. This change was done in the 2014-15 union-budget. Since then, the interest of people has increased in mutual funds and other investment instruments during these five years. In such a situation, the government would also like to encourage people to invest. For this reason, FM can increase the limit of investment under Section 80C which is at present 1.5 lakh rupees.

What kind of advantages you can avail -

If the Modi-led- government hikes the limit of investment under Section 80C, then you will get the direct benefit of it. For example, if your annual income is 12 lakh rupees so From this income and if you invest 2 lakh rupees in those schemes, on which you get tax exemption under Section 80C. In this case, your income tax will be calculated only on the basis of Rs. 10 lakhs.

What says section 80c?

Section 80 C of the Income Tax Act is a central section for taxpayers. Some schemes of investment and savings have been included under this. You get tax refunds on these schemes. This means if you invest in eligible schemes for tax exemption under this section, then you will not have to pay any taxes to a certain extent. At present, you can get a total refund of up to Rs 1.5 lakh under this section.

Which schemes come under Section 80C?

If you want to invest under Section 80C, you can save up to Rs 1.5 lakh in the present tax system. Under this section, you can invest in many schemes which are: 

-Equity Linked Savings Scheme (ELSS): These tax savings are mutual funds.

- Public Provident Fund (PPF)

- Tax Savings Fixed Deposit: These are those FDs(Fix deposits), whose lock-in period is of 5 years.

- National Pension System (NPS)

- Sukanya prosperity scheme

- Unit Linked Insurance Plan

- National Savings Certificate (NSC)

- Home loan: You can get tax exemption on the loan amount of the loan EMI and there is ‘No interest’ on it. 

- Life insurance, Health insurance, Pension funds and others