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Banks have called for a hike in the investment limit in Public Provident Fund and continued focus on public spending by the government in 2016-17.
At the pre-Budget consultation with Finance Minister Arun Jaitley on Tuesday, banks and financial institutions sought further relaxation in Section 80 (C) of the Income Tax Act. The section provides for tax deduction up to ₹1.5 lakh annually for long-term investments such as Public Provident Fund, life insurance and equity-linked saving schemes.
In their recommendations, bankers expressed hope of a further cut in policy rates by the Reserve Bank of India in this calendar year as well as faster approval to projects to help boost economic growth.
The over two-hour long meeting was attended by a number of bankers, including State Bank of India Chairperson Arundhati Bhattacharya and YES Bank Managing Director and Chief Executive Officer Rana Kapoor.
Earlier in the day, in a pre-Budget meeting with social sector experts, the Finance Minister underlined inclusive growth as a key priority for the government and said it would take adequate measures to ensure social security for the children, women and senior citizens of the country.
Social security benefitsOn their part, social sector experts sought wider coverage of social security benefits, increased allocations for the Right to Education, schemes for nutrition for children and the Mahatma Gandhi National Rural Employment Guarantee scheme and a higher rate of sin tax on alcohol and tobacco.
“There is a deficit of 9 lakh teachers. We have demanded allocation of at least 10 per cent of the national income to education and implementation of the Right to Education by the Centre,” said Ambrish Rai of the RTE Forum after the consultation with Jaitley.
Similarly, HelpAge India demanded that central allocation for old age pension be increased to ₹500 a month a person for those between 60 and 79 years and ₹1,000 a month for those over the age of 80 years.
Ashok Bharti, Chairman of the National Confederation of Dalit Organisations, said that allocation to NREGA should be increased by at least ₹5,000 crore in 2016-17 to meet demands of rural labour after two consecutive years of poor monsoon.
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