The Times of India 22.02.2013
It’s time to give women more tax sops
In 2000-01, Yashwant Sinha, the then finance minister,
had introduced a special provision under which the basic tax exemption
limit for women was pegged higher than that for men. This resulted in
lower tax liability of up to Rs 5,000.
While P Chidambaram
retained the provision in 2004-05, his first budget of his second term
in North Block, in 2005-06, he reduced the benefit to a maximum of Rs
3,927, including surcharge and cess. Chidambaram reduced the
differential benefit further before Pranab Mukherjee finally withdrew it.
While introducing the provision, Sinha had said that the additional
rebate of Rs 5,000 for women tax-payers “is equivalent to increase in
the exemption limit by Rs 50,000 over that of men”. However, tax experts
say that a preferential treatment for women is needed to encourage
them.
Kuldeep Kumar, executive director (tax and regulatory
practices) PWC India, said a preferential tax treatment to women is
highly desirable as it helps in empowering them. At a time when
government is giving financial help to girl child, a preferential tax
treatment to them will not be off the mark. When the government has
given reservations to women in Panchayats and is trying to extend the
same in Parliament, why is it shying away in giving special treatment in
taxes to them, he added. In fact, the government should increase the
exemption limit for women. This will certainly help women in acquiring
productive assets. In fact, if the differential tax benefit is increased
substantially, say up to Rs 20,000, a number of families will like to
transfer fixed assets on their women members’ name to bring down their
tax liability on their income.
A senior tax consultant, who do
not wanted to be quoted, said even if such provision might lead to
misuse to save taxes, it’s worth trying. She said in the short term, the
misuse of the provision would be more pronounced than its benefit, but
in the long term it will certainly help women empowerment. Another tax
consultant said any move to give special treatment to women in taxing
their income would be welcomed as it will ultimately help society. Kumar
pointed out that such special treatment should be increased for single
woman parent as a separate category. As it has become an accepted norms
in cities, the government must give them concession to enable them to
meet various challenges which they face as single parent.