Axe the tax: Parents demand more tax breaks on tuition fees
With educational costs rising, most parents believe more tax exemptions are required.
Mumbai: In the run up to the Budget Session, CNN-IBN's 'Axe the tax' touches upon upon tax breaks on tuition fees. With educational costs rising, most parents believe more tax exemptions are required. CNN-IBN met up with a family in Mumbai.
Two and a half year old Supriya will start school this year. It's a big step forward, not just for her, but also for her father. Management consultant Sundar Ramaswamy said, "School fees is anywhere between Rs 4,000 to Rs 8,000 in this area that means an expense of up to Rs 96,000 per year, which is huge for a family like ours."
Even the most conservative estimate puts the average monthly school fee at Rs 2,000. Sundar gets Rs 100 a month from his employer as education allowance, which is just 2 per cent of the actual expense incurred.
This exemption limit was fixed in 2000 with retrospective effect from August 1, 1997 and seems quite nominal considering the ever rising cost of education. The entire amount can also be claimed as tax exemption, but is clubbed with other savings under 80 C, which is capped at Rs 1 lakh. Rising inflation begs for a raise in the cap.
"Dear Finance Minister, in the current inflationary times Rs 100 is very low. This limit should be raised to at least rs 2,500 so that people like us can benefit," Sundar said.