Budget 2021 Expectations: Budget 2021 will be presented by the Finance Minister Nirmala Sitharaman amidst the COVID-19 pandemic. The expectations from the government will be higher to announce particular tax measures or incentives whilst dealing with the hospitalization arising out of coronavirus. The overall health insurance coverage penetration in the nation is not extremely higher and even inadequate to meet the whole expense of hospitalization. Further, the hospitalization prices for the remedy of coronavirus is not normal across hospitals in several cities.
Rakesh Jain, ED & CEO, Reliance General Insurance expects the government to take these measures in the upcoming Union Budget 2021:
“ Government of India should announce the package for all the hospitals on the treatment of Covid 19, in similar format as the packages are mentioned in the Ayushman Bharat. This pandemic has affected people in terms of financially where the insurance coverage was either not available or adequate coverage was not available. Government should also standardize the treatment cost across all the hospitals considering it large impact on population. Apart from this, reduction in GST rate from 18 per cent to 5 per cent is required, to increase the Health Insurance penetration.”
Include COVID-19 below section 80DDB
There is 1 other crucial location that requirements interest from the government. Under the tax laws, expenditures incurred on particular illnesses such as ailments contain Neurological Diseases, Malignant Cancer, AIDS, Chronic Renal failure and Hematological problems qualifies for deduction below section 80DDB up to Rs 40,000 ( Rs 1 lakh for senior citizens) a year.
“Government should also include hospitalization expenses incurred on treatment of Covid 19 under section 80DDB for the expenses which are done out of pocket apart from reimbursement from Insurance coverage,” adds Jain. By such as COVID-19 for the advantage below section 80DDB, a significant relief to the taxpayers specially these who are not covered by insruance can be anticipated.
The outbreak of COVID-19 has absolutely elevated the need to have of sufficient overall health insurance coverage. “The need for health cover has increased; we propose the govt to provide enhanced tax exemption for health insurance premium. This would further motivate the tax payers to increase the health insurance participation appropriate to the cost of healthcare. Under section 80D, there is a need to increase the limit by additional amount of 25000 both for self and parents as cost of insurance is increasing due to medical inflation,” says Jain.
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Currently, the premium paid for overall health insurance coverage currently qualifies for deduction below section 80D up to Rs 25,000 for these beneath 60 years of age, whilst the limit is Rs 50,000 for these who are above that age. The upper limit for tax advantage is low as it limits the quantity of sum insured. “Not only for Senior Citizens but for younger population as well additional tax Benefit should be extended. This will surely increase awareness and people could be encouraged to get appropriately covered with sufficient Sum Insured,” informs Jain.
With greater tax incentive, 1 could opt to enhance the coverage quantity. In instances when health-related inflation is higher and remedy expense is increasing, it is important to retain a higher coverage for self and loved ones members.