The tax regime for medical facilities provided by the employer contained in the proviso to Section 17(2) needs a wholesome relook. Its soft corner for hospitalisation is understandable given the fact that doctors in Government and approved hospitals normally will not play ball with employees.

But the reality is many of the chronic diseases like blood pressure require life-long medication at home without being hospitalised forever. In fact, a doctor's prescriptions holds sway in the interlude between two consultations, which is often long.

So much so, the chemists' bills account for the lion's share of one's medical expenses especially in respect of what are described as lifestyle diseases such as blood pressure and diabetes. And it is to this most crucial item of medical expenditure that the law is stingy Rs 15,000 per annum, period, fixed almost a decade ago. The apparent reason why it is so tight-fisted when it comes to non-hospitalisation expenses is the lurking suspicion that the ubiquitous chemist is the most malleable of retailers with a supple conscience cozying up to an avaricious employee.

While this mutual-back-scratching tendency of the two is definitely not a figment of imagination or a product of an over-wrought mind, not all the employees ought be tarred with the same brush.

The same distrust is at the back of the requirement that cruelly expects the family of a heart-attack victim to look for a list of hospitals approved by the Chief Commissioner of income-tax in the wee hours of morning when it (heart attack) usually strikes.

With most of the employers fixing a limit for reimbursement of medical expenses, which is often a month's salary, the income-tax law should give up its fixation about hospitalisation expenses and its paranoia of chemists' bills and private clinics. In short, micro-management should be given up in favour of a broad-brush stroke.

The parity of treatment given by the regime to foreign medical treatment is a trifle difficult to understand in a milieu where medico-tourism is the buzzword.

Why should the tax law loosen its purse strings to foreign medical expenses, which admittedly costs a fortune, reimbursed by the employers?

The Government, which woos the foreigners with a promise of quality Medicare at affordable prices, ought to first convince its own flock about the efficacy of the Indian treatment.

A salutary signal in this direction can be sent by inserting an express provision in the regime that taxes completely in the hands of the employee such reimbursement and by disallowing such munificence in the business income computation of the employer.

S. Murlidharan
(The author is a Delhi-based Chartered Accountant.)