NEW DELHI: Tax experts have always been advising us to save for our retirement and for our family, and all the savings can even help us save on income tax. But is the government encouraging us to put away enough? Many Indians want to be able to save much more.
Anya, who is a school going kid, is too young to know what inflation is, but it will impact her future. Rising prices and high taxes worry her parents as it'll affect how much they can save for her.
"It affects a lot being the sole earning member of my family. When I started my career, I earned as much as I pay my taxes now. It affects a lot," said Anya’s father Vikas Rewoo.
Vikas dreams of saving enough to take his family on a luxurious vacation, but it is difficult. Investments worth Rs 1.2 lakh is exempt from income tax. This includes most forms of savings – home loan principal, life insurance premium, your child's school tuition fee and retirement fund – leaving few exceptions.
"Prices of basic commodities have increased a lot. Though we are investing, my husband is investing more than Rs 1 lakh, still we are not benefiting as much as we should. So it is time the government increases it to Rs 2 lakh," said Moina Rewoo.
In addition to upping the tax exemption limit to at least Rs 2 lakh, the Aam Aadmi would feel the sting of inflation less if an income of Rs 2 -5 lakh is considered the first taxable slab, instead of the existing Rs 1,80,000 to Rs 2 lakh.
With more money in their kitty, families like the Rewoos would be able to invest better and save more, tiny steps towards painting a brighter future for little Anya.
"I appeal to the government of India to increase tax exemption limit from Rs 1 lakh to 2 lakh. This will help not only in better savings for families like us but also give incentives to people to save more money and put more money in banks," said Vikas.
- Smriti Advani