'Tax exemption for sr citizens should raise to Rs 7.5L'

The minimum tax exemption limit for senior citizens should be raised to Rs 7.5 lakh from Rs 3 lakh at present in the upcoming Budget, industry body Assocham has said.

It has suggested various other measures for senior and super senior citizens in its pre-budget memorandum submitted to the government.

The government is scheduled to present its first full Budget on July 5, for the current financial year.

"Increase minimum tax exemption limit for senior citizens (above 60 years) from current Rs 3 lakh to Rs 7.5 lakh and super senior citizens, who are 80 years and above, should not pay tax if their income is up to Rs 12.5 lakh.

"The population in the current senior citizens' category did not have robust social-security/pension fund investment facility during their working life and are thus hugely dependent on the interest income from fixed deposits etc. Considering that rate of interest has come down drastically in past one year it has left senior citizens in financial difficulty," the industry body said.

Besides, medical expenses shoot up heavily in old age as persons covered by mediclaim insurance policies have to cough up very high insurance premia after one or two claims, it added.

"Senior citizens have played a significant role in both private and public spheres, contributing to raising families and also to nation-building, as such, welfare of the elderly should always be our priority," said Assocham deputy secretary general Saurabh Sanyal.

It has also suggested the government that there should not be any TDS (Tax Deducted at Source) from payment of interest to senior and super senior citizens.

It has further urged the government to reduce the age limit for super senior citizens category from 80 years and above to 70 years and above.

"The current life expectancy of males in India (as per Census of India for 2011) is 67.3 years, for females, it is 69.6 years. Keeping this demographic data in mind, there is a need to revise this age limit," he said.