NEW DELHI: The government is planning to give some relief for pensioners and increase spending on social security schemes in the Union Budget set to be presented by finance minister Nirmala Sitharaman on February 1.
“While there is limited headroom for tax cuts, given the Covid-19 pandemic and financial insecurities arising out of it, some relief will be there for the vulnerable sections, especially the pensioners and senior citizens. The government is considering giving them some relief,” a senior official in the finance ministry said. In the pre-budget consultation, the PFRDA had already recommended relaxing some clauses in the NPS scheme and to increase the tax rebate for pensioners.
Ministry sources confirmed that the revenue department is considering some of these recommendations in the budget. There will also be increased budgetary outlays under other social security schemes.
Along with these measures, the budget is likely to enhance the tax rebate for health covers under existing tax laws in order to boost the spending on health insurance.
The finance minister has already hinted that post-Covid, the government will focus more on supporting the healthcare sector post corona.
The budget is crucial this year in many ways, especially as India remains one of the worst hit economies during Covid-19, leaving many people out of the social safety net, and with GDP expected to contract by 7.5 per cent by the government’s own estimates.
Experts have already suggested that the government needs to boost support to the salaried class. Job losses have become more visible with the outbreak of the pandemic and even those who have their jobs intact were hit by salary cuts and discontinuation of various allowances.
“It is not possible to give relief to all but the government will be sensitive to their needs,” the official pointed out.
The Cabinet Committee on Parliamentary Affairs has recommended that the Budget session be held from January 29-February 15 and from March 8-April 8.