New Delhi, Feb 7 (IANS): Business chamber Assocham said on Sunday it has suggested the government should hike the children's education allowance and offer tax exemptions to creche facilities in the union budget for 2016-17 to encourage more women join the workforce.

"To encourage more women in the workforce, it is desirable that a specific provision be introduced for allowing exemption for creche provisions," the Associated Chambers of Commerce and Industry of India (Assocham) has said in its pre-Budget recommendations on direct tax to the finance ministry.

"While we are confident about a positive multiplier effect of leaving more money in the hands of tax payers, a lot of women-specific proposals should be brought in the Budget so as to empower them economically," Assocham president Sunil Kanoria said in a statement here.

Assocham has asked for provision of allowance of up to Rs.2,500 per child every month for up to two children.

"To supplement household income, more women are entering the job market. With increased phenomenon of nuclear families, working women need support in terms of care of young children while they are at work," it said.

It wants the children education allowance exemption limit raised to Rs.1,000 per month from the current Rs.100.

"The limit for children education allowance is too low as compared to the prevailing school fee and was fixed in 1988-99," it said.

It has also requested that hostel expenditure allowance, which is exempted per child up to Rs.300 per month for a maximum of two children, be increased to Rs.3,000 per month, noting the limit was also fixed in 1988-89," it added.

Besides, the current exemption limit of Rs.15,000 per annum for medical expenses reimbursed by the employer needs to be revised to at least Rs.50,000 and extended to retired employees as well, Assocham said.