Good news for salaried employees in Draft Income Tax 2026 Rules! Up to Rs 1.05 lakh IT exemption on meal cards

Draft Income Tax Rules 2026: To avoid tax on minor benefits, the Income Tax Act has provided for certain exemptions on meal coupons, meal vouchers, Sodexo (Pluxee) food cards, and even subsidised meals provided by employers. Earlier, this exemption was capped at Rs 50 per meal. This meant that an employee would be provided two meals for Rs 50 each, i.e., a total of Rs 100, which was tax-exempt. However, this limit has increased manifold as per the draft Income Tax Rules, 2026. The draft tax rules, 2026 has increased this amount to Rs 200 per meal.

The draft Income Tax Rules, 2026, propose a major advantage for salaried employees who enjoy subsidised meals through office canteens or meal coupons like Sodexo, Pluxee, and Zaggle. Although an increase from Rs 50 to Rs 200 may not seem impressive, it could potentially allow salaried employees to claim tax exemption of up to Rs 1,05,600 annually, provided Parliament accepts the proposed limit of Rs 200.

Under the old tax regime, employees could claim exemptions on meal coupons, vouchers, and similar perks. The draft Income Tax Rules, 2026, focus only on how these perks are valued. Whether the tax benefits will be available under the new regime will depend on how the government amends the Income Tax Act and issues the relevant notifications.

Read on to see how this potential Rs 1.05 lakh tax exemption could impact salaries with CTCs of Rs 7 lakh, Rs 13 lakh, Rs 15 lakh, Rs 20 lakh, and Rs 25 lakh.

How salaried employees can claim up to Rs 1,05,600 tax exemption on meal vouchers

In this regard, it may be noted that, under the draft Income Tax Rules 2026, it would be permissible for employers to offer their employees a facility to purchase a voucher that can be redeemed at a restaurant to buy a meal worth up to ₹200.

If the employee is provided with two meals a day, it may be noted that the exemption would be available to the employee to the tune of:

This change could significantly boost annual tax-free benefits for salaried employees.

How does meal tax exemption work?

If the draft Income Tax Rules, 2026, are approved by Parliament, the revised tax-exempt limit would be calculated as follows: