Pension with disability benefits for soldiers who served full term to be taxed
Disability pension and the pension soldiers, who have served their full tenure with the three services of the armed forces, get will no longer be exempt from income tax, a recent notification of the Union finance ministry said.
Granting such income tax exemptions date back to 1922 and were among the incentives the British offered to make military services lucrative for Indians.
The notification said soldiers, who have been “invalidated” during military service, will only get the tax exemption. Soldiers, who are entitled to disability pension, necessarily do not have to retire or “go home” because of the disabilities they suffer during their service. Most in the artillery or those flying fighter places suffer from hearing disabilities because of loud noises. Only a handful soldiers are compulsorily retired because of the disabilities they suffer during their military service. The Central Board of Direct Taxes circular said the tax exemption for disability pension will be “available only to armed forces personnel who have been invalidated from service on account of bodily disability attributable to or aggravated by such service and not to personnel who have been retired on superannuation or otherwise”.
There are nearly 25 lakh veterans. Several soldiers, who have served their full tenure including chiefs, get disability pensions.
In the current fiscal ₹1,12,080 crore has been allocated for the pension. Burgeoning pension bills for the armed forces has been a cause of concern for the government which has implemented the long-standing demand of “One Rank, One Pension”. The fresh order led to angry reactions from veterans.