Why should Covid treatment expenses be tax deductible?

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The pandemic has disproportionately affected the middle class. Many people have spent their entire life savings on medical treatment for loved ones. In this difficult moment, the government should recognise the hardships faced by middle-class taxpayers.

The Finance Minister should give tax exemption to individuals who do not have medical insurance for medical treatment of the covid impacted. COVID-19 has had a terrible financial impact on these people’s lives.

The government should grant tax relief to persons who pay for Covid-19 medical treatment on their own in the Union Budget 2022-23. The following is a suggestion for how this tax relief could be delivered to such folks.

Section 80D of the Income Tax Act of 1961 permits an individual or HUF (Hindu Undivided Family) to deduct from taxable income the amount spent for health insurance premiums, preventative health check-ups, and contributions to the Central Government Health Scheme (CGHS). Medical expenses for senior citizens can also be claimed as a deduction under this provision if specific circumstances are met. An individual can claim a deduction for health insurance premiums paid.

Only medical expenses expended on the medical treatment of a senior citizen who is not covered by health insurance are eligible for a deduction under Section 80D. To put it another way, no deduction is allowed if the money was spent on medical care for:

(a)An individual who is not above the age of 65; or

(b)An individual who is covered by a health insurance policy.

Though the coronavirus is more dangerous to the elderly, it has infected and hospitalised persons of all ages. The government should broaden the scope of section 80D to provide a deduction for expenses expended on covid therapy for all people, regardless of age.

Thus, even if the affected person is not a senior citizen, an individual should be given a deduction of up to Rs 50,000 for medical treatment of covid-19 for himself, his spouse, or dependant children.

Furthermore, even if a parent is not a senior citizen, an additional deduction of up to Rs 50,000 should be permitted if the expense is expended for treatment of covid-19 for them. A HUF should also be given a deduction of up to Rs 50,000 for expenses incurred.

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