Pension expected to be tax-free in budget: Government may create separate bucket for insurance polic

Most of the people in the country buy insurance to save tax apart from protection. We hope that in the budget, the government will help in reaching more people by giving tax exemptions in the insurance sector. It is expected that the government can promote pension schemes by making pension/annuity tax-free in the hands of the subscriber. One option is to allow an exemption for the principal component. The private sector should get a level playing field with NPS.
The current limit for deduction under section 80D on health insurance premiums (including preventive medical check-up costs) is only Rs 25,000. This limit needs to be increased. The past two years of Covid have proved that the current limit is not enough.
Till a few years ago, the maturity amount of 2.5 lakh premium was tax-free under section 10(10D) of Income Tax. It has been made taxable once again. This decision should be withdrawn. This will encourage investment in huge amounts in the insurance sector.
There are several investment options covered under Section 80C of Income Tax. For example, life insurance premiums, PPF, ELSS, NSC, NPS, home loan principal, etc. We hope that the government will create a separate bucket for insurance policies or else increase the existing limit of 1.5 lakhs from 2 to 2.5 lakhs.
We expect that in the budget, the government will increase the TDS exemption limit on the insurance commission under section 194D of Income Tax from the existing Rs.15,000. This will encourage the insurance agent. Apart from this, 18% GST on products like insurance is high. At least basic protection plans should be brought under zero GST.