Expectations high from the Union Budget 2018. Citizens in the country are asking for Leave Travel Allowance(LTA) related tax reforms. 30-year-old healthcare professional Vidya Sagar is one such citizen who feels the changing times should give way to more relaxation in availing LTA. His company allows him to avail LTA every two years for domestic travel. He, however, feels visiting international destinations has become more affordable and sometimes turns out to be cheaper than travelling within the country.
Says Vidya Sagar, “I have been availing LTA for the last 8 years and feel it is not as beneficial as it seems. We go on a vacation within the country twice a year. We look forward to travelling overseas too and hope LTA can be extended to overseas travel too.” In many companies, mandatory leave is a must and employees are ready to pack their bags and choose holiday destinations.
Employees who are entitled to LTA as part of their Cost to Company (CTC) can reimburse a domestic travel under LTA which is not included in the taxable income. The LTA is different for different employees depending on their position and salary bracket. There are certain terms and conditions under LTA which include domestic airfare in economy class and travel in first-class railway journeys twice in four years for themselves, spouse, children and parents. Travel by other modes of transport is also permitted with certain restrictions. However, LTA does not include food, lodging and sightseeing expense. The current block of 2014-2017 will give way to the new block for LTA which is for the years 2018-2022.
Some employees feel LTA rules should be relaxed and overseas airfares should be included. Also, that LTA should be applicable every year instead of twice every four years. While there are other pertinent tax reforms that are on a citizen’s mind, they feel it is also important to focus on leisure and luxury amidst the pressure of paying taxes in India. How much importance Union Finance Minister Arun Jaitley gives to these voices on LTA will be seen during his budget speech on the 1st of February.