Finance Minister Arun Jaitley on Monday announced that contributions made under the Ex-servicemen Contributory Health Scheme (ECHS) would be eligible for claiming deduction under Section 80D of the Income Tax Act from the current financial year.
Jaitley also said that the decision would benefit members of the Armed forces who would join the scheme on retirement.
"Contributions made under Ex-servicemen Contributory Health Scheme or ECHS would be eligible for claiming deduction under section 80D of Income Tax Act from this financial year. This would benefit the armed forces personnel joining this scheme on retirement," Jaitley tweeted.
Section 80D of the Income Tax Act allows an individual to claim a deduction up to Rs. 25,000 per budgetary year for medical insurance premium instalments. In case the individual is over 60 years of age, the limit goes up to Rs. 30,000.
The ECHS, which was first introduced by the Government of India in April 2003, is a publicly-funded medicare scheme for ex-servicemen, pensioners and their eligible dependents, and provides medical care through out-patient treatment at 227 polyclinics all over India.
In September last year, the ECHS committee had launched the Complaint and Litigation Reduction Scheme (CLRS) and invited all stakeholders, including veterans and their dependents, ECHS employees at all echelons, hospitals and other service providers, for direct communication with the ECHS to reduce complaints and litigation.
The scheme was implemented to increase focus on the formulation of caring policy and initiatives for army veterans.