Exempt transport allowance & running allowance from income-tax: Agenda Item 47th NC(JCM) Meeting

Staff Side stated that transport allowance upto Rs. 800/- pm has been exempted from taxable income. The revised TA ranges to Rs. 3200/- plus DA thereon. As such, TA upto Rs. 3200/-pm + DA thereon may not be treated income and be exempted from Income Tax.

Staff Side said that transport allowance is in the nature of reimbursement of the expenses incurred by the officials. As Travelling allowance is not taxable, the transport allowance also could not be taxed. Standard deduction, the staff side pointed out, was not something new that was introduced in 2018 budget. It was in the statute earlier with much more benefit to the salaried tax payers. Those who are provided with transport vehicles, like staff cars etc., and consequently not in receipt of transport allowance have no tax liability. They added that treating transport allowance as taxable is discriminatory in character and asked the official side to reconsider the matter

Reply of the Official Side:

In Union Budget 2018, a standard deduction of Rs. 40,000/- in lieu of the present exemption in respect of transport allowance and reimbursement of miscellaneous medical expenses was introduced. So the present exemption in respect of TA (except in case of differently abled persons) has already been withdrawn vide notification dated 06.04.2018.

This item may be treated as closed.

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Item No.25/19/NC-47 – Arbitrary orders denying revision of pension and family pension in favour of the pensioners who were receipt of compulsory retirement pension and compassionate allowance under Rule 40 and 41 of the Central Civil Services (Pension) Rules, 1972.