The discussion paper about the DTC (Direct Tax Code) is now being revised. It was issued in the month of August 2009 and by this it has been declared to proceed with the present system of interest deducting payment up to Rs 1.5 lakh before the calculation of tax liability from whole income against the home loan.
When the paper was released in the year 2009, it had proposed not to go with the exemptions of the interest payment against the home loans but it was not implemented.
However the revised discussion paper has also raised the exemption against the investments in some savings like life insurance schemes, pension funds, PPF etc. up to Rs 3 lakh from the present limit of Rs 1.5 lakh. Earlier, the government had an argument for increasing the exemption limit against the investment.
It was also said that if the benefit of the interest payment against home loan is withdrawn then it will not affect the taxpayers.
But this argument of the withdrawal created a lot of unfavorable comments, and lastly the government has now decided to turn back to the existing system.
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