Tuesday, January 09, 2007

Tax exemptions to go, says PM

NEW DELHI: The coldest day in the capital this winter on Monday brought a chilling message — all tax exemptions could be pruned. Ahead of the Budget, speaking at the Ficci AGM, Prime Minister Manmohan Singh set the alarm bells ringing when he said: "In the long run, our tax regime should not have too many exemptions which make tax administration an unnecessarily complex exercise vulnerable to misuse." But the good news is exemptions available for individuals are not likely to be axed in this Budget; the focus is likely to be on exemptions for the corporate sector. But if the trend is established, it's a question of time before individual exemptions too — like the ones on home loans, investment in public provident funds, post office savings schemes and insurance — will face the heat.

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