Question

Which Committee recommended the abolition of tax rebates under Section 88?

1. Shome Committee
2. Chelliah Committee
3. Rangarajan Committee
4. Kalkar Committee

Answer 1

Correct Answer - Option 4 : Kalkar Committee

The correct answer is Kelkar Committee.

• Kelkar Committee-
  • It was formed in 2002 under the chairmanship of Vijay Kelkar.
  • The major recommendations of this committee were related to increasing the income tax exemption limit and abolition of wealth tax etc. Hence, option 4 is correct.

• Its major recommendations were- 
  • Extension of PAN to cover all economic agents/citizens.
  • Abolition of block assessment of search and seizure cases.
  • Increase in deductions under Section 80 CC from Rs. 1000 to Rs. 20000.
  • Elimination of tax incentives under Section 88, 80L, and interest income under section 10. 

• Section 88 of IT Act-
  •  Rebate on life insurance premia, contribution to provident fund etc.
    • Subject to the provisions of this section, an assessee, being-
      • an individual or
      • Undivided Hindu Family