Overwrite Salary Structure Amount Not Working for Deductions in Tax Calculations

I am facing a unique issue where overwriting a salary component deduction amount does not impact tax calculations.

I have a scenario where a deduction that impacts tax calculation could be varied based on circumstances and this variation is usually applied using additional salary and overwriting the default salary structure amount. What I find however is that the variation amount does not impact the tax calculation as the resulting tax calculation is always the same regardless of the change in the tax-impacting deduction amount.

The amount considered when tax is being calculated is always the default salary structure amount regardless of the amount specified after creating Additional Salary and checking the “Overwrite Salary Structure Amount”. What I have found is that this only happens with deductions as earnings work as expected. Any changes in the earnings component using additional salary impact the tax calculation but changes in deductions don’t impact it as the original amount is always used. Is this a bug or is this working as intended?