Bengaluru is not a 'metro': Centre refuses to grant metro status to India's IT capital. Here's why
Bengaluru a 'Metro' status. Union Minister of State for Finance, Pankaj Chaudhary, explained on Tuesday that under Rule 2A of the Income-tax Rules, 1962, a distinction is maintained between the cities of Mumbai, Kolkata, Delhi, and Chennai, and other places concerning special allowance for residential accommodation under section 10(13A) of the Income-tax Act, 1961. The four designated metropolitan cities have a 50 per cent salary consideration for computing exemption limits, while other cities, including Bengaluru, have a 40 per cent limit, a Bangalore Mirror report stated.
No Proposal to Change Policy for Bengaluru
Minister Chaudhary stated, “It has been the stated policy of the Government to rationalise tax rates and move away from exemptions and deductions. Therefore, designating more cities as metro cities and extending the benefit of a higher exemption limit on HRA to such cities contradicts the stated policy.” This means there is no proposal to change the existing policy.
Historical Demand for Recognition
For years, there have been demands to recognise Bengaluru as a Metropolitan City for House Rent Allowance (HRA) tax exemptions under income tax laws. If included, residents could claim a 50 per cent exemption on their salary equivalent to HRA, similar to the four designated Metropolitan Cities. This change would provide relief by reducing taxable income in an increasingly expensive housing market.
Centre's Stance
Despite Bengaluru’s rapid urbanisation and significant economic contributions, the government
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