« Top Headlines » Open DEMAT Account in 24 hrs  Delhi HC Rules GST Registration Cannot Be Cancelled Retrospectively Without a Clear Show Cause Notice (SCN)  Belated income tax return AY 2026-27: How to file, late filing charges and what you may lose  Major Financial Changes from August 1, 2026: ITR Deadline, RBI MPC Meeting, Tatkal Ticket Rules & More  Government proposes to ease tax relief conditions for offshore funds  TallyPrime Connected Banking: Automating Banking and Accounting  ITR Filing Deadline 2026: Is July 31 the Last Date to File Your Income Tax Return? Latest Official Update  ITR filing deadline nears: How to file income tax return online on e-filing portal - quick 15-step guide  Will the ITR Filing Deadline Be Extended Beyond July 31 for FY 2025-26? Here's the Latest Update for Taxpayers  Income Tax Refund Delayed for AY 2026-27? 5 Common Reasons Your Refund May Be Stuck and How to Fix It  ITR Filing 2026: FM Nirmala Sitharaman Asks Tax Officials to Let Honest Taxpayers Correct Genuine Mistakes  Will Your FCNR Deposit Stay Tax-Free After Returning to India? Tax Rules Explained for NRIs «  ‘Sensex sometimes surprises me, sometimes worries me’... No move to refund state levies to exporters... » Cheers: Your tax-free investment limit may be hiked October, 12th 2007 Individual tax payers may be in for some cheer. The tax-free investment limit for individuals may soon be hiked from the present Rs 1 lakh to Rs 1.5 lakh. The proposal that the government is deliberating has a condition though: the additional Rs 50,000 will have to be invested in infrastructure bonds. The move is aimed at mobilising funds to bridge the resource gap of about $40 billion in infrastructure during the Eleventh Plan period (2007-2012). The power ministry has already taken the lead, under the prime ministers direction, to launch Vidyut Vikas Patra or power bonds. The move may be announced in the next budget. The government is considering enhancing the tax-free investment limit with the dual purpose of providing relief to tax payers and mobilising funds for the infrastructure sector, which requires about $500-billion investment during the Eleventh Plan. The move has been favoured by a standing group of power ministers constituted by the prime minister. The group has now constituted a sub-committee headed by Planning Commission deputy chairman Montek Singh Ahluwalia to fine-tune the proposal for inclusion in next years budget, an official source said. The move may also help the government in the event of snap polls, added the source. Infrastructure bonds are reckoned to be good for mobilising resources; analysts see the new cap raising about Rs 3 lakh crore for infrastructure in the remaining four years of the Plan. The instrument lost its lure after it was stripped of the sub-limit for obtaining tax sops on such investments. u From Page 1 Till the 2004-05 fiscal, individual tax payers were given a tax exemption for investments up to Rs 1 lakh per annum. This benefit enjoyed a sub-limit of Rs 30,000 as maximum investment in infrastructure bonds. However, this clause was removed from the 2005-06 fiscal. Instead, infrastructure bond investments have since been made part of the overall Rs 1 lakh cap for availing tax benefit. The sub-limit is now proposed to be restored with an enhanced exemption of Rs 50,000 to woo back tax payers. It has been estimated that even if one-third of the tax payer base subscribes to power bonds, around Rs 75,000 crore could be mobilised each fiscal. The funds thus garnered would also benefit the power sector, which is short of about Rs 4.5 lakh crore in investment needs. The Eleventh Plan has targeted a Rs 10.3-lakh-crore investment strategy for the sector. The power sector alone could mobilise over Rs 1.2 lakh crore over the next four years if the tax-free exemption limit is enhanced. This is assuming that 40% of the amount mobilised (in line with the share of power in infrastructure sector) from infrastructure bonds goes to the power sector, the source said.