“According to the Finance Act, 2026, exemption from income tax has been granted only to those employees who were injured in action and were removed from service after receiving physical disability,” AICC ex-service department chairman Col Rohit Chaudhary (retd) said. File photo: AICC via PTI
Congress on Wednesday (Feb 18, 2026) slammed the government’s move to impose income tax on disability pensions of disabled armed forces personnel, calling it an “insult” to the sacrifices of soldiers and warning of its impact on morale.
Chairman of AICC Ex-Services Department Col (retd) Rohit Chaudhry along with Col (retd) SP Singh of Indian Ex-Servicemen’s League at a press conference said that under the Finance Bill, 2026, income tax exemption was given only to those employees who were injured in action and retired from service after acquiring physical disability.
Through this clause, the government removed the income tax exemption for disability pension recipients who sustained injuries in action and were retained in service, as well as those who had disabilities attributable to or aggravated by conditions of military service.
The ex-servicemen community has urged the government to maintain full tax exemption for disability pensions and withdraw the new disability policy introduced in 2023, Colonel Chaudhry said.
The party demanded the restoration of the status quo under the Income Tax Acts of 1922 and 1961, which kept such pensions exempt from tax.
He said that under both the Income Tax Act 1922 and the Income Tax Act 1961, disability pensions for employees injured on the job or whose disability could be attributed to or aggravated by working conditions were kept out of the tax net, whether they were canceled or retained in service.
He claimed that the government has been trying to tax such pensions since 2016 and has now limited the exemption under the Finance Bill 2026 to only those who were disabled after being injured in action.
He said the move would tax employees who continued to serve despite injuries or those whose disabilities were linked to harsh service conditions.
Referring to the 2023 disability policy, he said the renaming of the disability pension to “impairment relief” effectively made it taxable to new pensioners.
Referring to the example of Field Marshal Sam Manekshaw, who rose to the top despite being wounded in battle, Colonel Chaudhry said that holding wounded soldiers has long been a part of military tradition and morale building.
The Congress claimed that the decision could affect nearly two lakh disabled soldiers and warned of nationwide protests beginning at Jantar Mantar on March 1 if the move is not reversed.
Published – 18 Feb 2026 22:10 IST