The Hindu Business Line : Provide more funds for education

In the forthcoming Budget, more funds should be allotted to education so that all villages are covered by elementary schools and group of villages by high schools. Besides nutritious mid-day meal scheme, the Finance Minister should introduce special tuition schemes for weaker children and scholarship schemes for higher education. Compulsory elementary education is essential that all children are enrolled. Earn while learn schemes could be introduced. Special schools for youth for skill development should be started. For farmers, cash subsidy should be given on the basis of cultivated land holding. Investment in small-scale industry should be encouraged by tax sops, reduction in land registration charges and subsidy for investment in machinery. For salaried class, the following can be considered:

Raise in exemption limit, benefits under sections 80 C, CCC and CCD and bring corresponding changes in case of women and elders; restoration of standard deduction; FBT abolition; and simplification of tax laws.

A. Jacob Sahayam,

Thiruvananthapuram

Exempt bank deposit

interest from tax

The income-tax exemption for individuals should be enhanced to Rs 5 lakh, considering the price rise over the last many years. The business class is getting depreciation benefits, whereas the standard deduction for salaried class has been scrapped without any logic. This has to be reintroduced with a limit of, say, Rs 1 lakh. Benefits under Section 80C may be enhanced to Rs 2 lakh. This will enable the people to go for compulsory savings and savings is vital in a growing economy like India. Dividend, which is an income earned from mutual funds and company shares, is exempt from income-tax, whereas interest from bank deposits is taxable. This anomaly is to be removed by making interest from bank deposits exempt from income-tax. As banks utilise the funds for economic activities, infrastructure development, employment generation there is a strong case for exempting the interest on deposits from tax. If the Finance Minister is not in favour of exempting the whole interest, he can at least give exemption up to say Rs 50,000 a year. This will provide a level-playing field for the banks with other financial instruments.

B.N. Bharath

Manager,

State Bank of India,

Virajpet, Karnataka