18 March 2016
1. FOR 80g, to protect tax collections. If there is no cap on donations, people would park there moneys in non-profits with no other work but to hold moneys to save taxes!
2. to promote investments, capital gains are exempted in certain cases like on LTCG on listed equity or through partial exemptions through discount on tax rates or through exemption through reinvestment.
3. against for chapter VI deductions, purpose is to promote certain expenditures/investments. by giving exemptions, coverage for Life insurance, medical insurance etc is promoted. Same way people are incentivized to pay for education loans etc
The idea of tax laws is not only to collect more and more taxes but to redirect incomes and expenditure in a manner to allow for capital investments for future capability generation, equitable income distributions etc
CAclubindia
