Some tax-relief on bank interest

Re-introduction of section 80L, even with a lower limit of say Rs 7500-10000 would be very useful.

Everyone must keep aside some emergency funds in the savings account & short-term fixed deposits. These carry a very low rate of interest about 3.5-6 per cent. With section 80L abolished two years back, the post-tax return on these works out to practically nothing. In fact, it doesn't even cover a modest inflation of 5 per cent and hence loses value with time.

Since the amount kept in such short-term instruments is not large, and moreover there would be a limit above which bank interest would be taxable, the loss to the exchequer is going to be very minimal. But the benefit to practically every one of us is going to be huge. One, of course, is a decent return and two is the administrative convenience of not being required to keep track of even a few hundred rupees of interest we earn on the savings account balance.

Let's hope the FM takes care of these issues in the forthcoming budget to give a further impetus to long-term financial planning.