I-T exemption on home loans to go?

The government has begun a review of as many as 162 direct tax exemptions by listing them in public domain and inviting comments by July 5.

At the very top of this list is the politically sensitive exemption on agriculture income, special economic zones, life insurance premium, housing loans, rent allowances and co-operative societies meant to promote interests of scheduled castes and scheduled tribes.

The list, put out by the Central Board of Direct Taxes,  includes leave travel concession, death-cum-retirement gratuity received by government servants, income of provident funds, superannuation funds, gratuity funds and deposit linked insurance funds in certain cases, income of mutual funds registered under the Sebi Act, 1992, other notified mutual funds and even remuneration received by specified diplomats and their staff.

The all-encompassing list comes after a similar listing of several customs and excise exemptions.

The latest review list includes Section 10A of the Income tax Act, which allows deduction on profits derived from export of articles or things or computer software by undertakings situated in free trade zones, export processing zones, electronic hardware technology parks, software technology parks or special economic zones. At present, deduction under the Section is available till fiscal 2009-10.

Even Members of Parliament and the income of political parties are included. Allowances received by MPs under the MPs (Constituency Allowance) Rules, and allowances of Members of Legislative Assemblies under the 1986 Constituency Allowance, along with the income of political parties from house property, capital gains and income by
way of voluntary contributions, are up for review.
 
Pension received by individuals who have won specified or notified gallantry awards and family pension received by any family member of such individuals as also family pension of a member of the armed forces, paramilitary forces in case of death in the course of operational duties subject to conditions, are among the list identified by the CBDT.

The income of any university or other educational institutions existing solely for education purposes and not for purposes of profit, and which are wholly or substantially financed by the government, income of any hospital or other medical treatment institutions existing solely for philanthropic purposes and not for purposes of profit, wholly or substantially financed by the government, are also in the list.

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