The best replacement for exemption is exception.

The best alternatives to exemption are rated as following:
★★★★★  exception
★★★★  deduction
★★★  dependent
★★  allowance
★  standard deduction
★  waiver
★  exclusion
★  tax deduction
★  dependant
★  child tax credit
  withholding
  tax credit
  discretion
  sales tax exemption
  exceptions
  abatement
  dependency exemption
  itemized deduction

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