New Delhi: Industry body Assocham on Saturday said it has proposed to raise the basic exemption limit for individual income taxpayers in its pre-Budget memorandum to the government.Also Read - Budget 2022: Healthcare Sector Likely to Get Top Priority Amid Covid Pandemic | Here’s What Experts Say

According to the industry body, the basic exemption limit for an individual taxpayer should be raised to Rs five lakh from Rs 2.50 lakh in the backdrop of the inflationary impact over the years. Also Read - Good Time For Buyers as Home Loan Interest Rates to Remain at All-Time Low | Details Here

“Considering the inflation over the years, tax exemption limit should be increased from Rs 2,50,000 to Rs 5,00,000,” the chamber’s memorandum to the Finance Ministry stated. Also Read - Agricultural Reforms Have Started Benefiting Farmers: PM Modi at ASSOCHAM Foundation Week 2020

The new government would present its first full Budget 2019-20 to Parliament on July 5.

Besides, the chamber suggested that to bring a parity amongst salaried and non-salaried taxpayers, “it is desirable that standard deduction be reinstated in the statute. Approximately 20 per cent of the gross salary subject to a maximum limit of, say, Rs 1,00,000 could be considered for the purpose of standard deduction.”

At present, a disparity exists between salaried employees and self employed, resulting in higher tax being paid by the former. Currently, a standard deduction on salary of Rs 40,000 is provided.

“Standard deduction is not meaningful to large number of salaried tax payers as substantial portion of the deduction is offset by levy of additional cess of 1 per cent which was levied vide Finance Act, 2018,” the industry body said.

Additionally, Assocham proposed that to promote savings, deduction under section 80C should be raised from Rs 1,50,000 to Rs 3,00,000 per annum.