“We are planning to draw out a list of the perks, which will be issued soon. The notification is expected to come in a few days,” the official told The Indian Express. As a result, individuals will have to shell out more funds towards the government’s tax kitty.

Perks that are expected to be taxed include car provided by employer or the running expenses of a personal car that are re-imbursed by the employer, domestic help paid by employer, free or concessional education, any gift vouchers, food or non-alcoholic beverage given to the employee, membership fees of clubs paid on employer credit cards, value of travelling or tour paid for by employer for holiday of employee, among others.

“The perquisite value of these will be computed and added to the total annual income of the employee, which will then be taxed as per the set income tax rules and slabs specified in those rules,” said KPMG executive director Vikas Vasal. However, there are some items that will kick up a debate again, he adds. For instance, allowance for books and journals for the employee’s enrichment is one such case where there have been arguments at length over whether it will benefit the employer or accrues personal benefit to the individual.

“This will create a distortion and will off-set the benefit that has been made available to the individual by raising the tax slabs by Rs 10,000. In fact, the individual’s tax pay out may be more than what he or she would have paid if the slabs had not been revised,” said PriceWaterhouse Coopers associated director (direct tax) Kuldeep Kumar.

According to Budget 2009-10 documents, the government plans to amend Clause (2) of Section 17 of the Income Tax Act in order for perquisite to also include the value of any other fringe benefit or amenity as may be prescribed. Once the list is drawn out, it will be made applicable from April 1, 2010.