Life Insurance Companies Seeking Extra Tax Benefit

Private life insurance companies are demanding a separate tax exemption of Rs. 1 lakh for long term investments in life insurance and pension schemes in the Union Budget of 2008-09. The Budget will be presented in the Parliament for 2008-09 on February 29, 2008.

Currently, both long and short-term investments are eligible for tax exemption under Section 80 C of the Income tax Act, the limit being Rs. 1 lakh.

The Life Insurance Council of India says that the provision of a separate tax exemption category will encourage of long-term investments which are suffering due to lack of “a proper definition”.

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